UK DVD and music retailer HMV has called in administrators putting around 4,350 jobs in doubt.
Fears for the high street chain have lingered for over 12 months and were realised when a month-long 25% sale was announced, following significant losses up to December 2012.
Company bosses recently revealed they were in discussions with their banks after facing material uncertainties due to market conditions.
As of last night (Jan 14), Deloitte were installed to oversee the 239 HMV stores in the UK and Republic of Ireland as it assesses the future for the business and seeks out potential investors. A statement released by HMV confirmed that trading of its shares has stopped on the London Stock Exchange.
The statement from the 91-year-old retailer 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”.
HMV has struggled for some time, failing to compete with online sales, digital downloads and supermarket retailers. As debts mounted, HMV sold off its live entertainment arm and severed ties with the Waterstones book chain.
Lavinia Carey, Director General at the British Video Association, commented on the news with this statement: “HMV is the last specialist video retailer and BVA data shows that it has held its share of around 16% of volume sales over the last 10 years, while total market sales rose in the same period from 169 million units to 179 million units. Meanwhile internet sales have gone from 8.5% to 30% in 2012 but in terms of consumer spending on discs, the internet has taken a larger share of the value, with 19% to HMV and 36% online. The BVA’s year end statement also highlighted that over £0.5 billion was spent by consumers on digital video services. The BVA sincerely hopes that while in administration the value of this important retailer can be realised so that a re-structure will enable the best performing stores to continue trading and maintain consumer choice and access on the high street.”