Another UK retailer is headed into administration. HMV – which sells music, movies, and video games – made a last attempt to save itself last week when it asked its suppliers for approximately £300 million (about $482 million at today's exchange rate) but the proposal was turned down.
According to the Financial Times, the company made the following statement earlier today:
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.
Deloitte has been appointed as administrator, and shares for the company have been suspended. HMV stores are open for business across England today, but are not accepting gift vouchers. This reflects the motions UK games retailer GAME went through last year when it too went into administration. Like GAME, HMV hopes to find a buyer, though even in that case it's likely stores would be closed and staff let go, as happened with the former.
HMV has been around since the 1920s, but it seems in recent years its success has been due in part to the dissolution of similar businesses. According to the FT, HMV's market share and sales peaked in 2009 after Woolworths shut down, and though sales fell it continued to survive thanks to similar closures of competitors like Zavvi.
