HMV attracts private equity interest

Amy King
16 January 2013

Tweet
Facebook
LinkedIn
Google plus
Send to

A number of private equity firms have contacted HMV’s administrator Deloitte regarding a potential acquisition of the stricken firm, according to reports.

Standing in line for the beleaguered entertainment products retailer are turnaround specialist Endless, Jon Moulton's Better Capital and Oakley Capital, the owner of cultural guide publisher Time Out.

Following a string of high street collapses, including the latest casualty Jessops, HMV went into administration on Monday. But the music retailer is not new to private equity. In 1998, HMV Group was formed as a joint venture between Advent International and EMI Group, combining Waterstone's – bought from WHSmith – and EMI-owned firms HMV and bookseller Dillons. The £801m transaction was completed in three months. In May 2002, Advent exited the group through its flotation on the London Stock Exchange, which valued the business at £1bn.

The company called in the administrators earlier this week after suppliers refused to throw the struggling firm a £300m lifeline, reports say, and the company breached banking covenants. A year ago, suppliers took a 5% stake in the firm in an attempt to secure the chain. HMV now hopes to find a buyer and protect the jobs of its 4,000 members of staff.