Private equity and restructuring specialists Hilco has acquired the debt of troubled entertainment retailer HMV, it is understood.
According to The Financial Times, Hilco has acquired the debt from lenders and as such will take control of the retailer despite not buying the company in its entirety.
Yesterday, Hilco was appointed to advise administrators Deloitte, which confirmed last week that it had been appointed by HMV to “urgently assess its financial position”.
Hilco UK bought HMV Group’s Canadian business in June 2011 for a total cash consideration of £2 million in a bid to reverse the retailer’s ailing domestic operations.
It is hoped that its renewed involvement with the UK arm will help stabilise HMV’s position, as experts are hopeful that the retailer’s collapse into administration may not be the end of its story.
Kim Bayley, Director General of the Entertainment Retailer’s Association said last week: “It would be wrong to underestimate the affection which HMV is held by consumers and the determination of music and video companies to see HMV survive in some form.
“For their part, our members – although competitors of HMV – have been quick to express their support.
“We believe it is possible for the administrators to rescue something out of this situation.
“There is clearly is a viable business model for an entertainment retailer on the UK High Street.
“It is up to the administrators now to do their job and take the steps necessary to make it possible.”
Hilco could not be reached for comment at the time of publication.