Funding will support Poundworld’s target of adding in excess of 60 stores per year to its existing portfolio of over 300 stores

November 10, 2015 - Santander Corporate Bank has provided a new £50 million committed debt package to Poundworld Retail Limited (“Poundworld”) a leading UK value variety retailer, to support its next dynamic stage of growth and store roll out plan. Poundworld continues to have no material financial leverage and now benefits from the security of having enhanced and committed banking facilities. Earlier this year funds affiliated with private equity firm TPG Capital LLP (TPG) acquired a majority stake in family-run Poundworld.

Santander’s Leeds-based Large Corporate and Structured Finance teams worked together with the bank’s International Trade Finance team to create a bespoke financing structure which will support Poundworld’s significant growth objective of adding in excess of 60 stores per year to the existing portfolio of over 300 stores. The value variety retailer, that also has a growing chain of over 50 multi-price stores trading under the ‘Bargain Buys’ fascia, will invest in a new IT system and 500,000 square foot warehouse facility near to its existing head office in Wakefield as a platform for its continued growth.

Santander had previously provided a £25 million finance package to Poundworld in March 2014 which combined a working capital revolving credit facility and a trade import loan facility used to fund the purchase of stock, principally from the Far East. Currently, approximately 25% of Poundworld’s suppliers are based overseas.

This new committed financing package sees the facilities significantly increased in size and secures a stable source of financing for the next five years. Additionally, Santander will provide facilities for foreign exchange, asset finance and operational currency overdrafts for day-to-day banking needs.

The business started on a Wakefield market stall in 1974 and opened its first Poundworld store in 2004. In the financial year to March 2015, the company doubled its earnings and saw turnover grow by over 22% to £422 million.

Chris Edwards, Co-Founder, Poundworld Retail Limited, said: “We have worked to build a recognised and respected brand and customer offering that provides savings to over two million Britons every week. Our ambition is to continue to introduce Poundworld’s value proposition to even more cities and towns across the UK.

“Santander’s help two years ago put the business on a firm footing and their support helped us to improve terms with our suppliers, landlords and credit insurers. The business was in a great position to attract the interest of TPG, resulting in its investment earlier this year and, combined with the new facilities from Santander, Poundworld is in a strong position to push forward with its next phase of growth.”

The Santander deal team was led by Paul Watkin, Relationship Director in Santander’s Large Corporate Team; Adrian Rowles, Director Structured Finance and Mark Lonsdale, International Director and they said: “The Poundworld story is one that we are very proud to be associated with. We see a great fit between the impressive performance already achieved by the management team now coupled with the significant backing of one of the world’s biggest private equity firms and are delighted to be supporting their strategy for the next period of growth.

“Santander is able to provide real value with our global reach and our International trade capabilities and expertise. Our International solution was already in place with Poundworld and has proven to successfully fit the working capital requirements of the business. We are pleased to have been able to commit and increase our facilities as Poundworld seeks to increase its overseas supply chain.”

Lawyers from the Leeds office of Bond Dickinson, led by Finance Partner, John Connor, provided legal advice to Santander.

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Notes to editors

Santander UK is a financial services provider in the UK that offers a wide range of personal and commercial financial products and services. It has brought real competition to the UK, through its 1|2|3 products for retail customers and relationship banking model for UK SMEs. As at 30 June 2015, Santander UK was the most switched to bank, attracting 1 in 4 new retail customers. The bank serves more than 14 million active customers with c. 20,000 employees and operates through 900 branches and 68 regional Corporate Business Centres. Santander UK is subject to the full supervision of the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) in the UK. Santander UK plc customers are protected by the Financial Services Compensation Scheme (FSCS) in the UK.

About Us

Banco Santander (SAN.MC, STD.N, BNC.LN) is a leading retail and commercial bank, based in Spain, with a meaningful market share in 10 core countries in Europe and the Americas. Santander is the largest bank in the euro zone by market capitalization and among the top 12 banks on a global basis. Founded in 1857, Santander had EUR 1.51 trillion in managed funds, 12,910 branches and 190,000 employees at the close of June 2015. In the first half of 2015, Santander made ordinary attributable profit of EUR 3,426 million, a 24% increase.

Poundworld is a leading value variety retailer with over 300 stores and over 6,000 staff across the United Kingdom. The business was formed in 2004, but has origins from 1974 in a Wakefield market stall in West Yorkshire. Across its nationwide network of stores, Poundworld serves over two million customers a week, providing reliable savings on a range of top brands and quality products, including groceries, pet care, DIY, toys, stationery and electricals.

In 2014, Poundworld made the prestigious Sunday Times ‘Top Track 250’ list and was named one of the nation’s fastest growing companies of the year.

Facebook: https://www.facebook.com/Poundworld

Twitter: @PoundworldTweet https://twitter.com/PoundworldTweet

About TPG

TPG is a leading global private investment firm founded in 1992 with approximately $75 billion of assets with offices in London, San Francisco, Fort Worth, New York, Beijing, Shanghai, Hong Kong, Mumbai, Singapore, Sao Paulo, Moscow, and Melbourne, among other locations. TPG has extensive experience with private and public company transactions in multiple sectors. The firm has recently invested in several UK based businesses including Prezzo, Victoria Plumb and TES Global. TPG’s current and past global retail and consumer investments include Gelson’s, Lenta, Life Time Fitness, Debenhams, Burger King, Spirit Group, Mey Icki, Ontex, Bally, Ducati, Chobani, J Crew, Petco, Nieman Marcus and Savers, among others.

Bond Dickinson is a leading UK law firm providing a comprehensive legal service to clients across a wide range of sectors, from seven cities across the UK including London. Its clients range from FTSE 100 businesses to governmental organisations, privately managed businesses and wealthy individuals. The firm has offices in London, Aberdeen, Bristol, Leeds, Newcastle, Plymouth, and Southampton. It also has a strategic partnership with a German firm, Redeker Sellner Dahs, with five offices across Germany and Belgium. Bond Dickinson has teams of expert lawyers with specialisms across many sectors including chemicals & manufacturing; energy & natural resources; financial institutions; insurance; real estate; retail & consumer goods; transport & infrastructure; and private wealth.