Administrators take charge at HMV after High Court hearing
PUBLISHED: 07:31 29 December 2018 | UPDATED: 08:26 29 December 2018
Administrators are working to secure the future of HMV after the struggling chain's collapse.
A team from KPMG was appointed to the entertainment retailer, which has stores in Norwich, King’s Lynn, Ipswich, Bury St Edmunds and Colchester, following a High Court hearing on Friday night.
It heaps more doubt on the future of the company’s 128 stores and 2,200 staff, who have been on tenterhooks since news of the business’s troubles was revealed earlier this week.
Will Wright, partner at KPMG and joint administrator, said HMV had been hit by a decline in the entertainment sector as well as the general pressures facing high street retailers.
He said: “Whilst we understand that it has continued to outperform the overall market decline in physical music and visual sales, as well as growing a profitable ecommerce business, the company has suffered from the ongoing wave of digital disruption sweeping across the entertainment industry.
“This has been in addition to the ongoing pressures facing many high street retailers, including weakening consumer confidence, rising costs and business rates pressures.
“Over the coming weeks, we will endeavour to continue to operate all stores as a going concern while we assess options for the business, including a possible sale.”
He added that gift cards would be honoured while the business continues to trade.
HMV’s collapse into administration is the latest in a long line of corporate casualties in 2018, as weaker consumer confidence and the continued growth of online shopping make trading conditions tough for bricks-and-mortar retailers.
Toys R Us entered into administration in February and all its 75 stores, including in Norwich and Ipswich, was closed by the end of April, with 2,054 employees made redundant.
Electronics chain Maplin went bust on the same day as Toys R Us and all its stores ceased trading in June.
Poundworld fell into administration on June 11, putting more than 5,100 jobs at risk across its 335 stores. It disappeared from the high street in August after its administrators announced the chain’s final set of store closures.
Sports Direct founder Mike Ashley brought House of Fraser back from the brink, after buying the company out of administration for £90m in August.
Meanwhile, other retailers – including Debenhams, Marks and Spencer, Mothercare, Homebase and Carpetright – have undertaken store closure programmes.