Poundland looks set to get more time to find a buyer as rescue talks go on

Poundland looks set to avoid immediate collapse. Its US owners told MPs on Wednesday they were in favour of extending the deadline to find a rescue deal.

The discount chain employs 11,000 people and has been edging towards administration (a formal insolvency process). Here's where things stand.

What happened?

The deadline to secure a buyer was due to expire at midnight. Sources close to the situation say they expect more time to be granted, thanks to funding released in recent days.

The owner, Gordon Brothers, is understood to have frozen about £50m of Poundland's cash. That left bosses unable to restock shelves across its 600 shops. It has now agreed to release a further £9m, on top of £10m announced earlier. That should give the company an extra 10 days to find a buyer.

MPs on the business and trade committee questioned Gordon Brothers on Wednesday. Chairman Liam Byrne said he was "deeply concerned" and compared the firm to "a wolf on Wall Street, on the British High Street". Gordon Brothers denies accusations that it wants to profit by selling off the shops and stock piecemeal.

Why is everyone talking about it?

Gordon Brothers bought Poundland for just £1 last year. Three bids are now on the table, and so far it has rejected all of them. The firm stands to profit from selling the company and its stock in parts.

The two sides paint very different pictures. Chief executive Barry Williams told staff last week that like-for-like sales (which exclude new stores) were up 11.4%. He also said the chain made a £18.1m profit in the year to September, after a £68m loss the year before.

Gordon Brothers says the business is still "challenged and vulnerable to any potential downturn in future trading". It argues that splitting it up may be the best way to protect jobs. Poundstretcher, Tesco and B&M have shown interest in some shops.

What's next?

Poundland's board was due to hold an urgent meeting on Wednesday night. Prime Minister Andy Burnham is among the politicians calling for answers after the takeover bid was rejected.

The big question is whether a piecemeal sale would save more jobs than a buyer who keeps Poundland going as a national chain. Byrne urged Gordon Brothers to "do what is right to save jobs and stores and do that now".