Vultures Circle HMV

HMV’s admission that its future is hanging by a thread has at least one U.S. financial vulture hovering overheard.

Apollo Global Management, one of Wall Street’s biggest investment funds, has reportedly to have purchased a slice of the ailing entertainment retailer’s debts.

It puts Apollo in a good position to take the business as it teeters on the brink of collapse.

Despite hiving off MAMA Group assets for around £40 million, money that HMV had earmarked to cut its £160 million or so debt, the latest trading statement shows first-half losses of £37.3 million.

The company has already warned  it won’t be able to meet the bank payments due in January and April.

HMV’s share price has dropped 39 percent over the last 12 months, giving the company a stock value of £10 million.

The Sunday Times says Apollo has cut a deal with Allied Irish Bank to buy a little more than 10 percent for £20 million.
The paper also pointed out that this is the first time that one of HMV’s lenders has opted to offload some of its risk.

Apollo is now expected to buy more of HMV’s loans with a view to becoming its major creditor.

Apollo was founded by Wall Street trader Leon Black more than 20 years ago and now has £50 billion ($80 billion) under its management.

It already owns the Gala Coral bingo and casino chain, the Countrywide estate agency, and recently bought Mappin & Webb, a network of jewelery retailers.

Thai tycoon Apichart Jurangkool, whose family made its fortune from a huge car parts business in Asia and has quietly accumulated a 6.2 percent share of HMV, is another reportedly eying a move on the company.