The music industry has welcomed the move by Sunrise Records’ owner Doug Putman to save HMV.
The chain will retain 100 stores, while 27 will close – the full list is expected later today (February 5).
Geoff Taylor, chief executive BPI and BRIT Awards, said: “We are heartened that the large majority of HMV stores will continue to trade under the new ownership of Sunrise Records - a business with a successful track record in entertainment retail in Canada.”
“There is still a resilient market for recorded music on physical formats - last year accounting for over a third of all music consumption. Fans value the collectability, artwork, liner notes and great sound quality of music on CD and vinyl. With new investment and the support of labels, HMV can continue to offer music lovers the pleasure of browsing and buying physical music on the High Street.”
Taylor also urged the Government to help iconic retailers such as HMV. He recently spoke to Music Week about looking again at VAT and business rates.
“We hope that Government will play its part in helping to sustain important employers like HMV by reviewing the high levels of business rates that disadvantage physical stores compared to online traders,” said Taylor. “Meanwhile, we wish the new owners and the staff the very best as the chain heads towards its centennial celebration in 2021.”
ERA has already welcomed the acquisition as “good news for the UK’s entertainment industry”.
“Sunrise recognises that on top of streaming and downloading people continue to buy physical formats, which is still a significant £1.8 bn business,” said ERA. “HMV accounts for approximately a quarter of the physical music market and a third of the video market creating a significant opportunity for Sunrise in the UK. We wish the new owners and remaining staff every success in the future.”
This is a very positive outcome for the industry, for whom the importance of a place for music on the High Street cannot be overestimated
Drew Hill, MD of Proper Music Group, said: “This is a very positive outcome for the industry, for whom the importance of a place for music on the High Street cannot be overestimated.
“Physical formats remain an essential part of music consumption, and the chain’s sales of over £250m in 2018 prove it is a key player in entertainment retail. Sunrise’s purchase means people will still be able to immerse themselves in an environment of music discovery with access to specialist knowledge and recommendations from staff, something chief executive Doug Putman appears well aware of.”
He added: “We understand that while some 1,500 jobs will be saved, 27 stores will close, resulting in hundreds of redundancies. We hope these people are able to find alternative employment as soon as possible.”
Paul Pacifico, CEO of AIM said: “We are pleased to see a successful rescue bid from an experienced retailer that prevents HMV from liquidating and allows it to continue trading. We will look to Sunrise and administrators KPMG to build on the goodwill from the independent sector and ensure that independent suppliers are not unfairly overlooked for the bigger players. It has been encouraging to see how so many organisations across the music industry have come together in support to ensure a good outcome was possible. The music industry must cooperate effectively to survive markets under stress.”
UK Music CEO Michael Dugher said: “It is welcome news that HMV, such an iconic and important music retailer, will not be lost from our High Streets. We hope that every effort will be made to retain as many of the stores and existing workforce as possible.
"There is still a huge demand for recorded music on CDs and vinyl. We would like to see the Government do more to give stores like HMV a viable future on our High Streets, including reviewing crippling business rates.”
Liz Bales, CEO at BASE (British Association for Screen Entertainment), said: “That such a large number of stores across the HMV estate form part of the new venture speaks volumes about the continued importance, and relevance, of a high street outlet for the physical media, from burgeoning premium formats like 4K UHD and Blu-ray through to traditional DVD, that so many of us are still incredibly passionate about. Offering unrivalled depth of catalogue and an impassioned staff of experts, it is fantastic to be able to look to a future with HMV maintaining its rightful place on so many of our high streets across the UK.”