It’s been two weeks since the deadline passed for bids for HMV, which entered administration just after Christmas. Yet there’s still no sign of a preferred bidder emerging, despite rampant speculation across the industry.
Administrators KPMG declined to comment, but sources close to the process told Music Week that discussions are still on-going with a number of bidders regarding a sale. Negotiations are said to be “complex”.
High Street tycoon Mike Ashley is understood to be one of the bidders. His interest was first revealed by Music Week. According to reports elsewhere, Ashley has requested a “six-month rent holiday” from HMV landlords as part of his deal.
Ashley owns Sports Direct – which, somewhat ironically, took over HMV’s former Oxford Street flagship store in London the last time HMV went into administration, in 2013 – and has previously bailed out House Of Fraser and Evans Cycles. He also owns stakes in French Connection, Debenhams and Game.
Should Ashley’s bid succeed, his ownership would no doubt raise eyebrows amongst some in the business, although others suggest his ruthlessness and ability to make High Street retail work might be just what the ailing retailer needs.
Music Week understands a management buyout option is also on the table. That would bring continuity, although some in the industry would have concerns that such a bid would be too closely associated with the strategy that saw HMV end up in administration for the second time in six years.
Other rumoured interested parties include French retailer Fnac and Amazon, although no details of any firm bidder have been issued. Previous interest from discount group BuyVia collapsed when it transpired it had not actually been in touch with administrators.
Whoever the buyer, any deal is likely to be contingent on labels and distributors taking a hit on product already supplied on consignment – a move that could hit smaller, independent labels hard, although many would consider it a price worth paying for a continued physical retail presence on the High Street. ERA and the BPI have already led the calls for the chain to survive.
Many labels and distributors continue to supply the chain. This week’s big release – Bring Me The Horizon’s new album, Amo (RCA), is being stocked in HMV as normal, and has already delivered physical sales in excess of 13,000 units, a large chunk of which is likely to be via HMV.
No time limit has been set on finding a successful bidder, but the clock is ticking. One HMV store, in Gloucester, has already announced it will close today (January 30), according to local reports.
With the on-going problems at D2C platform PledgeMusic, those involved with physical music will be desperate for a solution to HMV’s ills. But for now, all anyone in the music business can do is wait, and watch this space…
* To read Music Week’s full investigation into the turmoil at HMV, click here. To read our piece on why the music biz needs to help save the retailer, click here. To subscribe and never miss a vital music business story, click here.