Digital downloads have claimed another top retailer as British entertainment chain HMV calls in the administrators.
That follows Virgin France’s collapse.
There are reports of interest from buyout firms for some of HMV’s stores and the chief executive said it will survive in some form.
“I’m confident that we will find a solution,” Chief Executive Trevor Moore told reporters on Tuesday.
“We remain convinced that we can find a successful business outcome. We know that HMV is a well loved brand, which has a high level of support amongst the public and we want to ensure that it remains on the high street,” he said.
Moore added that he and Finance Director Ian Kenyon had begun working with the administrators Deloitte to evaluate options for HMV, with a focus on safeguarding jobs. He said the intention was to continue to trade HMV’s 239 stores in the UK and Ireland. The firm employs around 4,500 people.
Deloitte intends to keep the business running while it seeks a potential buyer, HMV said.
The Financial Times reported retail restructuring group Hilco, may be interested in acquiring some of stores. Hilco already owns HMV Canada.
Buyout firm Endless is also expected to make approaches.
As well as downloads, the economic downturn and tough government austerity measures have hit consumer spending and confidence in Britain,
closing a number of once well-known retail names.
“It’s a sad but inevitable fate for a much-loved stalwart of the music industry,” Gregory Mead at global music analysts Musicmetric said. “HMV simply failed to adapt to the changing tastes of music fans and the seismic shift we’ve seen as everything has gone digital.”
Trevor Moore joined HMV last year from camera specialist Jessops, which last week also went into administration.
High and lows
Opened on London’s Oxford Street by English composer Edward Elgar in 1921, HMV, famous for its ‘Nipper the dog’ trademark, grew to become a musical powerhouse, selling records and albums to generations.
The firm had a hand in the Beatles’ big break 40 years later, recommending the group’s demo record to publishers.
It underlined its status as an industry figure by opening the world’s biggest music entertainment store in London in 1984.
The 1990’s signaled major expansion as HMV opened abroad and branched into books and then live music venues and festivals.
In 2006, it even rejected a private equity takeover bid valued at 847 million pounds, before the rise of online and digital music – and its failure to adapt quickly enough – spelled the beginning of its struggles.
A rapid fall in the sales of physical CDs has seen rivals like Zavvi go bust or others like WH Smith exit the market.
With DVD and games demand also in decline, HMV belatedly tried to shift its focus toward technology products like tablet PCs and headphones, but it faced tough competition to take sales away from online firms like Amazon at a time when cash-strapped consumers need to save money.