Wilko has sold its distribution centre in Worksop, Nottinghamshire, to logistics giant DHL for £48m to help refinance the business.

The retailer has leased the site back from DHL under a 15-year partnership agreement.

The move comes as Wilko battles to cut costs across the business due to the impact of the cost of living crisis on trading.

In September the company, which has 402 stores and an online service, brought in management consultants Teneo to help it find economies.

The company said the sale and leaseback deal is the first in “a series of positive partnership benefits”.

Wilko said it will continue to invest in its omnichannel offer and improve customer experiences.

Working in partnership with DHL means both Wilko and DHL will benefit from scale in property and warehousing.

Wilko said this will help it concentrate its efforts on “doing what it does best” – supplying families with great value products, easily accessible either online in or store.

Wilko chief executive, Jerome Saint-Marc said: “It’s standard business practice to constantly review how we manage our finances.

“This property deal with DHL represents long-term stability for us and our team members and is the right response to the current market conditions and our priorities.

“We’re making smart choices to trade a business and allow us to continue to invest in our long-term transformational strategy.

“Wilko remains family owned and continues to focus on helping hard working families to be the best that they can be, delivering great value products to our customers.”

Browne Jacobson partners Sarah Parkinson and senior partner Caroline Green were legal advisers to Wilko.

Sarah Parkinson said: “This partnership between a fantastic value retail brand and an excellent logistics business presents multiple mutual benefits including scale in property and warehousing.

“As always, Wilko has its family customers at the heart of what it does, so this move means they are even more committed to meeting rapidly evolving customer demands.

“We are delighted to have supported this collaboration and helped Wilko with its revised strategy.”

DHL has yet to respond to a request for comment.