HMV, the venerable UK music retailer that went into administration just after Christmas, has been sold to a company controlled by Doug Putman, the owner of Sunrise Records in Canada.
Sunrise Records & Entertainment, the new company, will acquire 100 HMV stores across the UK, and 1,487 employees will transfer as part of the transaction. The stores will continue to trade as HMV, with four stores continuing to trade as Fopp, according to a statement from administrators KPMG.
The price was not disclosed, though Mr Putman said suggestions he had bought it for a nominal sum were wrong. A total of 27 stores — including the group’s flagship store on London’s Oxford Street — will not be acquired and will be closed with immediate effect, resulting in 455 redundancies.
Will Wright, partner at KPMG and joint administrator, said: “We are pleased to confirm this sale which, after a complex process, secures the continued trading of the majority of the business.”
Mr Putman said: “We are delighted to acquire the most iconic music and entertainment business in the UK and add nearly 1,500 employees to our growing team.”
He said the skills and knowledge of the group’s staff were particularly important. “You can fix many other things, but you cannot recreate that passion if it’s not there,” he said.
Sunrise, which is privately owned, bought around 70 HMV Canada stores in 2017 from then-owner Hilco, which also owned HMV in the UK until it went into administration for the second time in late December. It has been hit hard by the decline in sales of CDs and DVDs in favour of streaming services such as Spotify and Netflix. Mr Putman said he intended to focus more on vinyl, in-store events and expanding the back catalogue.
News of the rescue was welcomed by the Entertainment Retailers Association while Peter Stack from music label BMG said there was “a widespread sense of relief” about the news.
That was shared by HMV’s staff. “There’s a lot of relief, mixed with sadness for those colleagues whose jobs were not saved. Rescuing a hundred stores really is a great achievement,” said one company insider.
He described Mr Putman as a “kindred spirit, someone who likes browsing through the racks”, comparing him favourably with “some other [bidders] with short-term financial goals” — a reference to Mike Ashley’s Sports Direct group.
However, Patrick O’Brien at GlobalData said that while the news was a “welcome surprise”, the underlying problem had not gone away. “It is difficult to see how the market for physical music and DVDs can sustain a 100-store chain in the long term,” he said. “Sunrise will have to do more than merely increase market share of the music and video market.”
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