The retailer, which employs 12,000 people, blames mounting cost pressures at its 400 UK stores.
Image source, Getty ImagesUK homeware retailer Wilko has warned that it is on the brink of collapse, putting some 12,000 jobs at risk.
The privately-owned company said it had filed a “notice of intention” to appoint administrators after failing to find enough emergency investment.
Wilko, which has 400 UK stores across the UK, is well-known for its affordable everyday items.
Chief executive Mark Jackson said it would continue to talk with interested parties about options for the business.
He said the company was left with “no choice but to take this action”, but hopes to find a solution as quickly as possible to “preserve the business”.
Wilko did not confirm in the announcement on Thursday whether or not any jobs would be affected.
Andy Prendergast, national secretary at the GMB union, said: “This is extremely concerning but we remain hopeful that a buyer can be found.”Wilko’s staff deserve reassurance that their jobs are safe. We hope this is the number one priority going forward.”
Wilko added that it had received “significant interest” from investors and some offers but none of them would have provided enough cash within the time needed.
Rising interest rates, higher energy costs and squeezed consumer spending have all been weighing on retailers.
Shops including furniture retailer Made.com and clothing group Joules collapsed into administration last year, although were both offered rescue deals by High Street giant Next.
But Wilko’s boss said on Thursday that the company, which has an annual turnover of about £1.2bn, had a “robust turnaround plan” in place.
The discount chain has been struggling for months and had been considering a company voluntary arrangement, where some of its landlords would receive no rent for three years.
After Mr Jackson joined the retailer late last year, it also announced that it would cut 400 jobs in a bid to cut costs.
At the time, the GMB union said that the company was in a “fight for survival”.
The latest move gives Wilko breathing space of up to 10 working days to come up with a rescue deal.
The company, which was founded in 1930 in Leicester, is still owned by the Wilkinson family.
It has already borrowed £40m from Hilco, a specialist retail investor and the owner of Homebase, and has even been exploring the potential sale of a stake in business, according to reports by Sky News.