HMV is all set to go into administration, putting more than 4,000 jobs at risk, after 92-year-old retailer confirmed that its talks with its banks and key suppliers over a £300million lifeline had failed.
The administrator Deloitte will keep HMV’s 239 stores in the UK and the Republic of Ireland open while it seeks potential buyers. However, HMV has confirmed that despite stores being open, gift vouchers won’t be accepted.
HMV administration comes less than a week after Jessops collapsed, leaving over 1,500 job at risk. The news of administration resulted in fall of 1.1p in HMV shares, leaving the retailer of CDs, DVDs and computer games a market value of just £5.1m.
In a statement last night, HMV said, “The board regrets to announce that it has been unable to reach a position where it feels able to continue to trade outside of insolvency protection and in the circumstances therefore intends to file notice to appoint administrators to the company and certain of its subsidiaries with immediate effect.”
A collapse in album sales has hit the music industry including HMV, as Brits spent more than £1bn on downloaded films, music and games in 2012, according to the Entertainment Retailers Association. HMV collapse would be a major blow to the high street, which last year saw failure of JJB Sports, Comet, Peacocks and Blacks Leisure.