Hope has risen for HMV as Hilco has reportedly bought its debts worth £176m from Lloyds and Royal Bank of Scotland, thus gaining control of the music retailer, which went into administration last week. Although this does not mean that Hilco has acquired HMV, it does indicate that HMV is on the verge of being saved from closing down.
Sources close to the situation claim that the move has brought stability to HMV and Hilco will now have to chart a further course of action with HMV’s administrators Deloitte. Hilco has been the frontrunner to acquire HMV, having been appointed as adviser to the HMV administrators Deloitte. Hilco has advised Deloitte to keep the HMV business running through the administration process.
Apart from Hilco, HMV has been sought after by a staggering 50 parties, which included trade buyers and private equity groups as well. Game Retail, the entertainment retailer which was purchased by OpCapita, expressed interest to acquire 45 HMV stores. Other interested parties included Better Capital, the buy-out group run by private equity veteran Jon Moulton; Endless, an investment firm focusing on distressed companies; and Peter Dubens, whose Oakley Capital owns part of Time Out.
HMV fell into administration last week, putting 4,190 jobs at risk, with banks and suppliers refusing to bail out the sinking chain. Initially, HMV’s administrators refused to honour gift cards but this morning Deloitte announced that HMV gift cards and vouchers would be accepted, to the relief of customers who ran a high-profile campaign asking the administrators to reinstate the gift voucher purchases.