Lakeland, the family-owned homewares retailer, has become the latest takeover target for an investment vehicle which has rapidly become one of the industry’s most acquisitive investors.
Sky News has learnt that Modella Capital, owner of Hobbycraft and The Original Factory Shop, is among a small number of parties vying to acquire a controlling stake in Lakeland.
A sale process, which kicked off in January, has also drawn interest from Hilco, the former owner of HMV, retail industry sources said.
Lakeland, which is controlled by the three sons of founder Alan Rayner, is understood to be seeking new funding running to tens of millions of pounds as it faces headwinds including the imminent hike to its national insurance bill.
Established in 1964 as Lakeland Plastics, the company employs roughly 1,000 people across a chain of nearly 60 stores, at its head office in Windermere and its distribution centres.
Sky News revealed in January that it had hired Teneo as financial advisers.
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At least one other bidder is understood to remain in the process.
PricewaterhouseCoopers, the accountancy firm, is advising HSBC, Lakeland’s principal lender.
Modella’s interest in buying Lakeland comes as it explores cost-cutting and restructuring options at both Hobbycraft and The Original Factory Shop.
It is also one of two remaining bidders for WH Smith’s high street retail arm.
Pepco’s decision to explore a sale of Poundland may also draw interest from Modella.
The increase in employers’ national insurance, which comes into effect early next month, has provoked protest from retailers and hospitality businesses, with industry bodies warning the changes will be a tipping point for many employers.
J Sainsbury, the supermarket giant, plans to axe 3,000 jobs as part of an transformation programme accelerated in part because of its growing cost base, while the chairman of JD Sports Fashion and the British Retail Consortium said this week that “every retailer” was looking at cost-cutting options.
A Lakeland spokesperson said in January that it was “considering a number of options to ensure a sustainable and long-term capital structure, which builds on our 60-year heritage as one of the UK’s most innovative homeware retailers”.
Lakeland was founded when Mr Rayner began selling plastic bags for home freezing from his family garage in the Lake District.
It now sells more than 4,000 home and kitchen products.
Accounts filed at Companies House for 2023 warned that it entered that year “facing the most challenging economic conditions for several decades with high inflation leading to falls in demand for many traditional categories”.
Sales during the year were broadly flat at £153m, with Lakeland’s auditors warning of a “material uncertainty… [about] the company’s ability to continue as a going concern”.
The accounts added that it completed the renewal of its banking facilities with HSBC after the year-end, comprising a £7.5m revolving credit facility expiring in May 2028 and £10m trade finance facility.
The average annual energy bill will rise to £1,849 as industry regulator Ofgem increases the price cap for the third time in a row.
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The new figure represents a 6.4% a year – or £9.25 per month – increase in the typical sum the vast majority of households face paying for gas and electricity when using direct debit.
You can read more about the changes and why they’re happening here.
Only those on fixed-rate deals – around 11 million homes – will see no change until their current term expires. An extra four million homes have fixed the cost of energy units since November, Ofgem said.
Standing charges – daily fixed fees to connect to a gas and electricity supply which vary by region – are also rising for gas while dropping for electricity, but it depends on where you live.
So should you fix?
Consumer expert Martin Lewis says that, based on where energy prices are currently at: “If you find a fix for up to 3% more than the current (January to March) or 3% less than the new (April to June) price cap, it’s predicted you’ll save over the year compared with staying on the price cap.”
The best deal currently on the market is with Outfox the Market, which is offering a 12-month fix for 7.4% less than January’s cap and 12.9% less than April’s.
EDF is currently offering a no-exit fee fix, and Octopus is doing the same for existing customers – so if the maths work for you, these could be risk-free options.
We spoke to Emily Seymour, Which? energy editor, about switching.
“There’s no ‘one size fits all’ approach when it comes to fixing an energy deal as it will all depend on your individual circumstances,” said Seymour.
“For example, if you have an electric vehicle, you might want to look for a tariff which offers cheaper electricity overnight to charge your car.
“As a rule of thumb, we’d recommend looking for deals close to the current price cap, not longer than 12 months and without significant exit fees.”
Other help
The warm home discount provides a £150 annual reduction on energy bills.
Those wanting to receive the payment must be getting the guarantee credit element of pension credit or be on a low income with high energy costs.
The government advises: “If you’re eligible, your electricity supplier will apply the discount to your bill. The money is not paid to you.
“You’ll usually get the discount automatically if you’re eligible. You only need to apply if you’reon a low income in Scotland– contact your energy supplier to apply.”
Those on pension credit will also be eligible for the winter fuel allowance later this year – this is worth up to £150.
BROADBAND AND MOBILE
While Ofcom’s new rules banning inflation-linked contracts came into effect in January, many consumers will be on older contracts that will still see a price rise linked to inflation.
This is causing confusion among customers, so for overall clarity: Uswitch says this April’s rises are expected to add an average of £21.99 annually for those on inflation-linked contracts and up to £42 a year for those on newer “pounds and pence” plans that are subject to fixed increases.
How do you know which contract you have?
Many providers started putting customers on fixed increase contracts in 2024 – so if you started a new broadband contract recently, you may be subject to a pounds and pence price hike.
These are the dates the providers started introducing them…
BT/EE/Plusnet: Contract started on or after 10 April 2024
Vodafone: Contract started on or after 2 July 2024
TalkTalk: Contract started on or after 12 August 2024
Three Broadband: Contract started on or after 1 September 2024
Virgin Media: Contract started on or after 9 January 2025
So if you signed up for a deal on any of the above after those dates, you should be on a fixed annual increase – but you’ll want to check your individual policy.
Here’s an overview of the hikes being implemented by major providers…
Consider switching
You might be able to avoid the rises by switching provider as cheaper deals are often available to new customers.
You should check to see if you’re out of contract first, or what the exit penalty may be.
Research by Which? shows switching providers when you’re out of contract could cut bills by up to £235 annually.
If you don’t want to leave your provider, you could also call them and try to haggle down your monthly cost.
Several broadband providers have social tariffs available, helping those on benefits access an internet connection at a lower monthly price.
According to Uswitch, two-thirds of financially vulnerable households are unaware that low-income broadband tariffs exist.
Bundling?
You may be able to get cheaper prices by bundling your phone, internet and TV services – though you need to read the small print as exit fees can be significant.
TV LICENCE
The cost of a TV licence will also go up by £5 to £174.50
The rise comes after a £10.50 rise brought the charge to £169.50 in April last year.
If you’re 75 or over and you get pension credit, or you live with a partner who does, you qualify for a free TV licence.
You can apply for it here or by calling TV Licensing on 0300 790 6071.
Those in residential care or sheltered accommodation can get a licence for £7.50, while those registered blind or living with someone who is can get a 50% discount.
TRAIN FARES
Train fares in England have increased by 4.6% as of 2 March. Railcards are also going to become more expensive, despite the record-low reliability of services.
The Welsh government matched Westminster’s cap, while Transport for Wales is applying various increases to its unregulated fares.
Meanwhile, the Scottish government will increase all ScotRail fares by 3.8% from today.
One of the best ways to beat the price hikes is by getting a railcard – and they’re not just for traditional concession groups. We outlined all the different railcards here…
Mark Smith, who set up The Man in Seat 61 blog to help people travel cheaper and better, told Money there were various “traps” people fell into.
Tickets are normally released around 12 weeks in advance, but initially you may only see more expensive Off-Peak and Anytime tickets.
There’s often a gap of a week or two before reservations open and the much cheaper Advance fares go on sale.
Smith says you can save money by purchasing any time before your day of travel – a £30 or £40 Advance fare will then turn into an £68.60 Off-Peak one-way or a £184.70 Anytime, for example.
If you are forced to travel at peak times you should consider split ticketing. For example:
If you’re travelling at 5pm on a Monday, instead of getting a peak ticket all the way from London to Manchester, get a peak Anytime ticket to Milton Keynes and then an Off-Peak from Milton Keynes to Manchester.
One final trap to avoid was exposed by a Which? investigation last year that found train station ticket machines could be much, much more expensive than buying online.
CAR TAX
Also going up is the standard rate of road tax for cars registered after April 2017.
The flat rate cost of car tax from April 2025 is £195 (so an increase of £5).
Hybrid cars get a small discount (£10) but if your vehicle had a list price of more than £40,000 when it was first sold then you may also be liable for the “luxury car tax” fee, which adds £410 to your annual costs.
You may pay less if your car was first used before 2017 – the exact amount will depend on the year a car was registered and the type of fuel it consumes.
Perhaps a bigger change is that electric vehicles (EVs) will also no longer be exempt from tax – those registered from April 2025 will pay the lowest rate of £10 in the first year, then move to the standard rate.
Feeling confused? Autotrader gives this example…
It’s April 2025 and you’re choosing between Porsche Macans, petrol or electric (lucky you). A basic petrol Macan will mean you pay £4,680 in car tax in the first year, whereas with the electric one, you’ll pay £10. After that, they’ll both go to the standard rate (£195 per year) plus the £410 Expensive Car Supplement for five years.
Image: Vehicle tax reminder. Pic: iStock
WATER
Possibly the most controversial of the April changes is the sizeable increase to water bills.
Bills are going up in a development that has been blamed on problems including higher borrowing costs on large levels of debt, creaking infrastructure and record sewage outflows into waterways.
However, it was reported last March that England’s private water firms made £1.7bn in pre-tax profits – up 82% since 2018-19 – prompting renewed calls for the utility to be renationalised.
The average annual water bill will rise by 26% or £123 in the next financial year alone, figures showed.
Water UK said the increases across households would also vary, depending on circumstances such as water use and whether a water meter was installed.
All water companies offer a social tariff for eligible customers that reduces the cost of water bills – check with your provider to see if you are eligible.
Should you get a water meter?
Martin Lewis has some simple advice on this one: if you have more bedrooms than people in the house, a water meter is likely to save you money.
If your water company says it can’t give you a meter, you can asked for an “assessed charge” – which can offer the best of both worlds. Ofwat explains yours rights here.
STAMP DUTY
Changes come into force from today and affect those in England and Northern Ireland.
The current “nil rate” band (at which you start paying) for first-time buyers will reduce from £425,000 to £300,000, while other home-buyers will also see a reduction from £250,000 to £125,000.
In London, an average first-time buyer could end up paying more than £11,000 extra from April, Santander said.
Some 85% of top-tier council authorities in England are set to increase council tax by just under 5%.
Additionally, Bradford, Newham, Birmingham, Somerset, and Windsor and Maidenhead have been given special permission by the government to bypass the 4.99% cap – meaning they could raise council tax by more.
Our data and forensics unit has been taking a look at how council finances have deteriorated here.
With the majority of councils increasing their council tax by the maximum amount this month, some households could see their bills jump significantly.
Are you eligible for a discount?
You may qualify for extra support or a reduction in your council tax bill, for example if you’re on a low income, a student, living alone or are disabled.
Another option is to have your council tax bill spread over 12 months instead of the usual 10 – this won’t save you money but could help you to budget, if your council offers this option.
You could also get your home’s council tax band reviewed, which may entitle you to a refund if you’re in the wrong band. However, you should be aware the review could lead to your property being put in a higher band.
STEALTH TAX
Expecting a pay rise?
You may be surprised to see how little translates to your pay cheque.
That’s because frozen income tax thresholds could mean that some people get pushed into higher tax brackets as their wage goes up.
Others could be pushed into paying tax on their savings by breaching the personal savings allowance – which is £1,000 tax-free interest for basic rate taxpayers.
WHAT TO DO IF YOU’RE STRUGGLING TO PAY BILLS
If you’re having trouble paying your bills, there’s lots of support out there.
Emily Seymour, from Which?, told Money: “If you’re struggling to afford any household bills such as energy, council tax, water and telecoms, the first step is always to speak to your provider and see what help is available.
“It’s important to remember that energy companies are obliged to help you if you tell them you are struggling to pay and will not disconnect you if you miss a bill payment. You could ask for a review of your payments, a reduction in your payments or a payment break, more time to pay, and access to hardship funds.
“For water and broadband, there are cheaper social tariffs available so it’s worth speaking to your provider to see if you qualify.
“If you don’t qualify for a broadband or mobile social tariff, our research shows you could still make big savings by switching providers – especially if you’re with a firm that hikes prices annually – so it’s always a good idea to compare deals at the end of your contract to find the best offer for you.”
You can check your eligibility for benefits on the government websitewhich may allow you to access lower tariffs and contact your local council to see if you’re able to get support with water and energy bills.
There’s also charities offering help, including Citizens Advice and National Debtline, which are on hand to provide free, impartial advice.
Elon Musk’s father has told Sky News that protesters targeting his son’s cost-cutting work for the US government are “bums”.
Errol Musk was responding, in an interview with Business Live, to a growing backlash among US taxpayers and Tesla customers against his son’s role in the Trump administration-created Department of Government Efficiency (DOGE).
The electric car firm has increasingly become the subject of sales boycotts and protests – neither of which have been consigned to the US though dealerships there have seen vehicles vandalised and even set alight.
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0:36
‘Elon Musk has got to go’
Musk Sr told presenter Darren McCaffrey: “To take notice of the bums that are trying to hurt Tesla by damaging cars, well that’s just plain silly. Nobody does that, you know, you use your brain… and (it) tells you these people are the problem, not the car.”
The anger directed at Elon Musk was “media hype”, he said as he also dismissed growing unease among Tesla investors that his son’s main business interest was suffering at a time when the challenges facing it are only rising.
Earlier this month one of Tesla’s earliest investors, Ross Gerber, told Sky News Mr Musk should step down as the electric carmaker’s chief executive unless he quit his work for the Trump administration.
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6:41
‘I think Tesla needs a new CEO’
His worries included bad publicity and Mr Musk’s ability to devote enough time to Tesla.
It was revealed last week that Tesla sales had fallen 40% in Europe and were behind those of cheaper Chinese rival BYD on an annual basis.
Mr Musk himself has since warned he expects a “significant” hit to Tesla from Mr Trump’s metal tariffs and looming duties on all US car imports and car parts.
He also hinted at the weekend, in an interview with Fox News, that he could soon have more time on his hands as the bulk of his work at DOGE should be completed by late May.
Errol Musk denied any suggestion that his son was overstretched, saying there were good people at Tesla to delegate day-to-day business while Elon completed “vital work” for US taxpayers, given the state of the country’s mounting debt pile.
“He’s got plenty of ability to do that. Don’t worry about it,” he said, while predicting that Tesla shares would recover to $600 per share by the year’s end. They are currently changing hands for $254.
“There’s no concern there whatsoever, not at all,” he said.
The acting chief executive of the Post Office is being lined up to take the job on a permanent basis as the state-owned company continues talks with ministers over its long-term funding arrangements.
Sky News has learnt that Neil Brocklehurst, who was named interim chief last September, is close to being handed the role.
Whitehall sources said on Monday that an announcement about Mr Brocklehurst’s appointment was likely to be made in April.
The decision, which requires the approval of business secretary Jonathan Reynolds, will bring a degree of stability to an organisation still grappling with the financial and reputational consequences of the Horizon IT scandal, which saw hundreds of sub-postmasters wrongly convicted of fraud and false accounting.
Reliant on the government for its funding, the Post Office has been in negotiations with ministers about delivering a previously pledged pay uplift this year.
Earlier this month, Sky News reported that Nigel Railton, the company’s chairman, had informed thousands of Post Office managers that he had yet to gain certainty from Whitehall about a £120m increase for this year.
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The sum was promised in November as part of a strategy to rebuild the Post Office in the wake of the Horizon scandal.
The Post Office has outlined plans for an ambitious transformation which includes franchising more than 100 directly managed branches.
Image: It was announced last year that Nick Read would leave the Post Office in March
A substantial number of jobs are also being cut at the company’s head office as part of the restructuring.
Several tranches of those have already taken place.
Mr Brocklehurst replaced Nick Read at the Post Office’s helm following a turbulent period for the outgoing boss.
Mr Read was repeatedly accused of being obsessed with his pay arrangements and being at the centre of a series of rows with both board colleagues and his government employers.
Like Mr Railton, Mr Brocklehurst is a former executive at Camelot, the previous National Lottery operator.
A Post Office spokesman declined to comment, while the Department for Business and Trade has been contacted for comment.