HMV to be rescued in Hilco deal that will save jobs and shops

Collapsed music retailer HMV looks set to emerge from the ashes in a takeover by Hilco that will salvage 2,500 jobs and 140 shops, Sky News reported Friday.

Restructuring firm Hilco is poised to sign a £50m deal to rescue HMV from administration.

The entertainment chain went bust in January, appointing Deloitte as administrators, after failing to keep up with online competition.

Hilco could announce a deal as early as Friday. It will see Hilco acquire about 130 HMV-branded stores and all nine of the outlets which operate under the cut-price music brand Fopp.

People familiar with the situation told Sky an agreement was likely to be struck later although it could be delayed.

Neither Deloitte nor Hilco could be reached for comment.

A takeover bid by Hilco has been speculated since it took over effective control of HMV in January.

Hilco, which already owns HMV Canada, purchased the group's debt from its lenders, Lloyds and Royal Bank of Scotland.

HMV's debt last October stood at £176m but it was understood Hilco paid much less to acquire it since the chain entered bankruptcy.

RD