Fortress Investment Group is preparing a restructuring plan for Poundstretcher Ltd, just two years after acquiring the discount retailer, as the UK high street continues to face pressure from weak consumer demand and rising costs, according to a report by Bloomberg.
The proposed plan, which requires court approval, would cut rents by at least 25% on roughly 50 stores and eliminate rent entirely for another 50 underperforming locations. Landlords may receive equity participation in return for the concessions, which are set to expire after three years. The plan would also reduce a portion of Fortress’s existing Poundstretcher debt.
Poundstretcher confirmed the restructuring as part of a strategy to support growth, emphasising that no store closures or layoffs are planned. Fortress and the retailer declined to comment on the financial details.
The move follows broader strain in the UK retail sector, where elevated costs and subdued consumer spending have forced landlords and lenders to absorb losses. Last year, rival discount retailer Poundland underwent a significant restructuring.
Fortress, which acquired Poundstretcher in 2024, also provided the retailer with a £30m financing facility last month to support working capital needs. Poundstretcher reported a pre-tax loss of £9.9m ($13m) in 2024, reflecting ongoing challenges in the retail environment.
