Poundland to open stores in Spain

They will be Poundland's first foray into Continental Europe and will bear the Dealz name used for the chain's 31 stores in Ireland, where the currency is the euro.

The first Spanish stores will open in the next 12 months, with all 10 open within two years.

Chief executive Jim McCarthy said last year that the plan was for the European Dealz stores to sell more than 90 per cent of their goods for 1.49 euros, with the rest retailing at prices from two to five euros each.

Mr McCarthy said today: "The success of Dealz in the Republic of Ireland was a clear demonstration that we have the capability to generate positive financial returns in new geographies quickly.

"We have been very careful and thorough in our evaluation of further European expansion opportunities and we are confident that our offer and our model suits the Spanish market well.

"We have a very detailed, low risk and low cost entry plan and the management strength and capacity, in the UK and in Spain, to execute it well. I'm confident that Poundland's amazing value will quickly resonate with Spanish customers."

Poundland says it will use the lessons from its store launches in Spain as it then opens shops elsewhere in Europe.

The expansion is expected to be funded by the planned flotation of Poundland on the stock market later this year, a move that will value Poundland at around £800 million and raise £200m-£300m to help pay for the European stores.

The company was founded 20 years ago by former market trader Steve Smith, who later sold the business for £50 million.

It has now expanded to over 500 stores and Mr McCarthy says he wants to see 1,000 Poundland stores in the coming years as the company keeps growing.

It currently employs around 12,000 people, 750 of them at its headquarters in Willenhall and its nearby distribution depot in Bilston.