High street entertainment retailer HMV has formally announced that it is going into administration.
In a statement released overnight HMV said: “It is proposed that Nick Edwards, Neville Kahn and Rob Harding, partners of Deloitte LLP, will be appointed as the administrators of the Company and certain of its subsidiaries. The Company’s ordinary shares will be suspended from trading on the London Stock Exchange with immediate effect.”
It has been widely reported this morning that HMV have stopped accepting gift vouchers at their stores and it is thought that over 4,000 jobs are at risk.
HMV has struggled for some time in the face of a shift towards digital music sales and competition from other outlets such as supermarkets. This has been compounded by poor sales over the Christmas period and refusal from HMV’s suppliers to loan the ailing chain £300 million to help keep it afloat.
Trevor Moore, boss of HMV, said this morning: “”We remain convinced we can find a successful business outcome. The intention is to continue to trade the stores.”
He added: “I would like to personally pay tribute to the 4,500 people who work for HMV. Clearly this is a very worrying time for them and their families.”
At the end of last year, HMV sold its live music assets to the private equity arm of Lloyds Banking Group in a £7.3 million deal. HMV purchased MAMA Group in 2010 for £46 million but offloaded a number of venues – including the London establishments the Barfly and Jazz Café, the Manchester Ritz and Lovebox festival – to offload its debts. The sale also included the Great Escape and Global Gathering festivals and HMV’s 50% interest in its Mean Fiddler joint venture with MAMA. HMV sold another of its live music ventures, the Hammersmith Apollo, in a £32 million deal in 2012.