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16 January 2013

Buyer may be found for HMV

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HMV

Administrators are not ruling out the possibility that a buyer may yet be found for stricken entertainment retailer HMV.

So say Nick Edwards, Rob Harding and Neville Kahn of Deloitte, who have been appointed as official administrators.

The closure of HMV would put 4,123 jobs at risk across its 233 stores in the UK. However, Mr Edwards said that the administrators are “working closely with management and staff to stabilise the business in order to continue trading while actively seeking a purchaser for the business and its assets”.

According to Deloitte, certain subsidiaries of the brand, including HMV Guernsey, HMV Hong Kong, HMV Ireland, HMV Singapore and 7Digital Group, remain outside the insolvency process, offering some hope for its future.

Garry Wilson, managing partner of turnaround equity firm Endless LLP, told ERT that although his company had expressed an interest in the purchase of HMV, it was too early to tell whether a bid would be made.

He said: “People always come and ask us if we’re going to buy these failed businesses because we’ve done so in the past, but it’s too early to say. Ask me in a few days and I might know more.”

Mr Wilson is reported to have said that he expects interest from rival bidders.

Michael Perry, retail analyst from Verdict, agreed that HMV might well be rescued from administration. Although he also warned that it would have to operate with fewer outlets.

Mr Perry added that independent record shops may now see a boost: “There is always going to be a demand for physical music retail, be it from record collectors who enjoy the process of going in-store, engaging with knowledgeable and enthusiastic staff and leaving with a stack of new music to listen to, or from those who simply don’t like shopping online but don’t have their music needs catered for by the grocers or other non-specialists.”