HMV has gone into administration, as the entertainment retail giant succumbs to increased competition from online retailers and supermarkets.
The move could spell the end for its 92-year presence on the high street, and puts over 4,000 jobs in doubt.
In a statement last night, HMV suspended trading in its shares but said the administrators would continue to trade the stores while they seek a purchaser for the business.
The 236-store retailer of CDs, DVDs and computer games will appoint the accountancy firm Deloitte as administrator after HMV’s banks and suppliers ran out of patience.
The collapse comes just days after camera chain Jessops shut all its 187 stores and months after electrical retailer Comet disappeared from the high street.
All three chains lost sales to online retailers such as Amazon and competiton from large supermarkets.
The explosion in digital downloading compounded HMV’s problems, UK consumers spent more than £1bn on downloaded films, music and games in 2012, according to the Entertainment Retailers Association.
HMV had asked suppliers for £300m of additional funding to pay off its debt mountain, as part of a radical restructuring its business, but this has been rejected.
The retailer had seen a 10.2% slump in sales and its net debt rising to £176.1m over the six months to the end of October.
HMV launched a clearance sale in its stores on Saturday, but last week denied this was anything other than standard procedure to clear stock.
Analysts believe that if a buyer does emerge for HMV, then it is likely that at least half of the retailer’s 200-plus stores will eventually close.
The composer Sir Edward Elgar opened the inaugural HMV store opened on London’s Oxford Street in 1921. HMV stands for “His Master’s Voice” and the retailer is synomymous with Nipper, the Jack Russell dog that listens to a gramophone in its most famous logo.
