HMV S'pore: Business as usual

PHOTO: HMV S'pore: Business as usual

SINGAPORE - HMV Singapore said yesterday it is business as usual for operations in Singapore and Hong Kong until further notice.

HMV Group announced on Monday in London that it would appoint an administrator, raising fears of more than 4,000 job losses.

The company's spokesman in Singapore declined to answer queries about how many staff the company has here, but said that updates would be given.

HMV opened here at The Heeren in 1997. Today, it has two outlets, one at Marina Square and the other at 313@somerset.

Accounting firm Deloitte has been named as the administrator and it intends to keep the business running, while it seeks a potential buyer, HMV Group said in a statement late on Monday.

"The board regrets to announce that it has been unable to reach a position where it feels able to continue to trade outside of insolvency protection," said the statement.

Administration is the process whereby a troubled company calls upon independent expert financial help in an attempt to remain operational.

HMV added that the board "understands that it is the intention of the administrators, once appointed, to continue to trade, while they seek a purchaser for the business".

The 92-year-old institution employs around 4,350 staff in total, but has struggled to meet the challenge of online retailing and digital downloading, and has been teetering on the brink for many months.

"The problem it has is that its core product categories are disappearing, and that's a very hard thing to fight," said analyst Kate Calvert of Seymour Pierce brokers.

The company, which also operates in Ireland, announced last month that it was in danger of breaching bank-loan arrangements, and its shares on the London Stock Exchange were suspended on Monday.

It has huge debts and, last month, reported sales were down 13.5 per cent, leading to a crash in the share price that left the company valued at just over £5 million (S$9.8 million).

It launched a huge, month- long sale in London last Saturday offering 25 per cent off a huge range of products to boost sales, but even that was not enough to keep the administrators from the door.

The first HMV store opened in London's Oxford Street in 1921 under the ownership of the Gramophone Company, which endowed it with its legendary trademark, the image of a dog listening to a gramophone - His Master's Voice.

It became part of music history in 1962 when Brian Epstein cut a demo for The Beatles in the shop studio, which led to the Fab Four signing with EMI, the record label that owned HMV until 1996.

It is the latest British retailer to fall into administration. Photography chain Jessops announced last week it had called in outside help, while retail chain Comet collapsed into administration late last year and opened its doors for the last time last month.

The 1990s signalled major expansion as HMV opened abroad and branched into books and then live-music venues and festivals. In 2006, it even rejected a private-equity takeover bid valued at £847 million, before the rise of online and digital music - and its failure to adapt quickly enough - spelled the beginning of its struggles.