After days of speculation over the fate of the UK high-street entertainment retailer, it has emerged that Hilco have taken over control of HMV, though they do not yet own the company.
Hilco, which already owns HMV Canada, has bought the debt of HMV from the group’s lenders, Lloyds and Royal Bank of Scotland.
The debt deal gives Hilco effective control of HMV, which fell into administration last week.
HMV has been hit by competition from online rivals, supermarkets, and illegal music and film downloads.
HMV’s estimated debt was about £176m, but Hilco is believed to have paid much less than this to acquire it because the retail chain is in administration.
Although Hilco does not yet officially own HMV, the debt deal gives it effective control of the music and DVD chain.
This news will come as a welcome relief to the independent film distributors who rely on repeat business from the retailer, and ensures that low-budget straight-to-DVD titles maintain a constant presence on the high-street.
HMV may be safe for the time being, but now the real challenge begins as the company seeks to ensure lasting stability against its predominantly online competitors. Hilco are restructuring specialists, but before they can even contemplate the long-term future of HMV, they must first regain consumer trust, which may not be easy.