Poundland spends big on 99p stores

99p Store customers could soon be asked to spend an extra penny after its marginally pricier rival, Poundland, announced a £55m bid for the discount retailer.

Still subject to approval from competition watchdogs the bid would see the 99p Store and Family Bargains brands subsumed into the Poundland umbrella, effectively doubling the stores presence in the UK and Ireland to more than 500 outlets.

Jim McCarthy, Poundland's chief executive, said: "This is a good deal for both businesses and will benefit customers and shareholders. Through working together, Poundland will improve choice, value and service for 99p Stores' customers, bringing Poundland's proven know-how and range to 99p Stores.

"We also believe that we can improve the performance of the 99p Stores estate and generate further value for Poundland's shareholders.

"We look forward to working with the CMA as it undertakes its review."

The Competition & Markets Authority is currently assessing the takeover with a two month review of the potential implications of the move.