The Willenhall-based discount retail chain has been working closely with Fultons for 12 months, developing its chilled and frozen food range and building a distribution network to serve stores.
This partnership has enabled Poundland to roll out frozen and chilled foods to more than 70 of its stores and the acquisition will now enable Poundland to significantly extend the offer to another 40-plus stores by December, beginning this month in Luton.
The deal demonstrates the intent of Pepco Group, the owner of Poundland, to invest in widening the customer offer in Poundland.
Alongside extending the range to a further 40-plus stores in 2020, Poundland plans to invest more than £25 million over the next two years in its chilled and frozen operation to convert the most appropriate Fultons stores into a full Poundland format, retaining a frozen and chilled offer in each location.
It will also establish Fultons’ Barnsley base as its national frozen distribution centre and build the infrastructure at its Harlow distribution centre to bring its frozen and chilled food offer to stores across the south of England.
This will create around 1,000 full and part-time roles through the introduction of chilled and frozen in stores and the transformation of the distribution centres in Barnsley and Harlow.
Poundland expects to bring its chilled and frozen offer to a further 150 stores in the 2021-2022 financial year and to as many as 500 stores over the next two years, making it an increasingly significant player in the near-£20 billion UK chilled and frozen food market.
Both Fultons co-owners will remain involved in the business. Karen Rees will become managing director reporting directly to Poundland managing director Barry Williams. Kevin Gunter will continue in an advisory role for six months. All 800-plus Fultons colleagues will join the Poundland family this month with no changes to their terms and conditions.
Mr Williams said: “We couldn’t have developed our chilled and frozen ranges without Fultons’ expertise and now is the right time to move to the next level and bring the team on board.
“By combining our experience, we can accelerate our frozen and chilled rollout and bring the amazing value it offers to more of our customers across the UK.”
Fultons’ managing director Karen Rees said: “For the last 12 months we’ve been proud to partner with Poundland, but even prouder that today we become family.
“We already know the Poundland customer loves our frozen and chilled foods offer – and we’re excited to know our people will be able to play a bigger part in Poundland’s transformation story."
Fultons’ chairman Kevin Gunter said: “After leading the business for 24 years, I’m pleased we’ve been able to agree terms with Poundland who are committed to a renewed period of growth and investment. I’m looking forward to contributing in an advisory role over the next six months."
More than 40 existing Poundland stores will receive an Ice makeover in the coming weeks – including Bearwood, Walsall Bescott and West Bromwich Queens in the week starting October 26.
By Christmas, Poundland expects to be offering chilled and frozen food in around 125 of its existing stores.
Since opening its first store in Burton upon Trent in 1990, Poundland has built a network of more than 800 stores in the UK and the Republic of Ireland.