Footfall Rises At HMV

Music fans appear to be doing their bit to save HMV, as foot traffic has reached “near Christmas levels” since the giant retail chain went into administration.

The increased publicity – plus the company’s Blue Cross Sale – has resulted in a surge of nostalgia that’s seen consumers return to HMV stores, according to Retail Week.

The retail sector publication also says that Hilco, the restructuring specialist that bought HMV Canada for £2 million in June 2011 and now controls HMV UK’s debt, could also be interested in acquiring camera retailer Jessops.

Hilco is reportedly interested in launching Jessops concessions within HMV stores.

HMV Canada actually increased its sales in 2012 and it is hoped that Hilco can repeat a similar turnaround for the UK chain.

The British press is reporting that Hilco wants to rescue about half of the 223 HMV stores in the UK. Music companies are understood to be considering a credit deal that would allow HMV to buy CDs and DVDs in installments over an extended period.

The Sunday Telegraph claimed that Royal Bank Of Scotland and Lloyds, the leaders of HMV’s eight-bank syndicate, had already received offers from vulture funds worth more than Hilco’s bid, but turned them down.

Fearing their reputations would be damaged if they sold out to asset strippers, the banks instead plumped to give HMV, which has 223 British shops and 4,000 employees, a chance under the Hilco turnaround plan.

The Telegraph said that about 50 investors submitted indications of interest when HMV fell into administration, including Jon Moulton’s Better Capital, turnaround firm Endless and OpCapita, the American turnaround investor that controversially failed to rescue Comet, yet still made a profit from buying it.

It is understood several investors offered to pay up to 4p in the pound more for HMV’s debt than Hilco, which has been stalking the struggling music retailer since it first ran into difficulty with its lenders in 2011. Lenders also received sizable bids for HMV’s assets, including a £20 million offer for the retailer’s flagship Oxford Street store.