Ailing music retailer HMV has had a stay of execution.
Back in February, restructuring company Hilco UK announced the closure of 66 HMV stores across the UK, a move potentially affecting over 900 employees. By the end of the month, that toll had jumped to 1500, with a further 37 stores getting the chop. Unsurprisingly, speculation about a possible buyout has been building for months, with Dragon’s Den‘s Theo Paphitis and supermarket Asda among those in the frame to take over the company.
As MusicWeek report, Hilco has now officially confirmed it will acquire and run the remaining HMV stores itself. The Hilco team will control the business, with Hilco CEO Paul McGowan acting as HMV chairman, but existing management staff have been kept on for the foreseeable future. The move will safeguard 132 HMV stores, and will also guarantee the survival of the nine stores currently run by HMV offshoot Fopp. The decision is expected to secure 2,500 jobs.
According to McGowan:
“We have spent a number of weeks negotiating revised terms with landlords and the key suppliers to the business, all of whom have been supportive of our plans to maintain an entertainment retailer on the High Street. We hope to replicate some of the success we have had in the Canadian market with the HMV Canada business which we acquired almost two years ago and which is now trading strongly. The structural differences in the markets and the higher level of competition in the UK will prove additional challenges for the UK business but we believe it has a successful future ahead of it.”
Hilco have also revealed that they are looking to expand into the Republic Of Ireland. HMV called in Deloitte in January after years of declining profits and rising debts. Hilco subsequently bought the company’s £176m debt.