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HMV administrators make 930 staff redundant as they shut first 66 stores HMV administrators make 930 staff redundant as they shut first 66 stores
(35 minutes later)
Nearly 1,000 HMV staff are facing redundancy as administrators for the failed music store chain revealed they will shut down 66 sites across the country. Almost 1,000 HMV staff are facing redundancy as administrators for the failed music store chain revealed they will close 66 stores across the country.
The loss-making stores, including all five Edinburgh sites, three in Glasgow and four in London, will close over the next two months and comes as administrators from Deloittes plan to sell the company's flagship Oxford Street store.The loss-making stores, including all five Edinburgh sites, three in Glasgow and four in London, will close over the next two months and comes as administrators from Deloittes plan to sell the company's flagship Oxford Street store.
Joint administrator Nick Edwards said: "As part of our ongoing review of HMV's financial position, we have now completed a review of the store portfolio and have identified 66 loss-making stores for closure. This step has been taken in order to enhance the prospects of securing the business' future as a going concern.Joint administrator Nick Edwards said: "As part of our ongoing review of HMV's financial position, we have now completed a review of the store portfolio and have identified 66 loss-making stores for closure. This step has been taken in order to enhance the prospects of securing the business' future as a going concern.
"We continue to receive strong support from staff and are extremely grateful to them for their commitment during an understandably difficult period. All other key stakeholders remain very supportive and I continue to be hopeful of securing a future for the restructured business.""We continue to receive strong support from staff and are extremely grateful to them for their commitment during an understandably difficult period. All other key stakeholders remain very supportive and I continue to be hopeful of securing a future for the restructured business."
HMV called in administrators in early January after poor Christmas sales and a further 3,000 jobs are at risk. HMV called in administrators in early January after poor Christmas sales. A further 3,000 jobs are at risk.
At first gift cards, worth around £7m, were suspended, but these were later reinstated after a customer backlash.At first gift cards, worth around £7m, were suspended, but these were later reinstated after a customer backlash.
Restructuring group Hilco took over the retailer's debts of around £176m from its lenders, including Lloyds and Royal Bank of Scotland. Buying the debt gives Hilco effective control of the business but not ownership. Restructuring group Hilco took over the retailer's debts of around £176m from its lenders, including Lloyds and Royal Bank of Scotland, giving it effective control of the business but not ownership.
Hilco is thought to have the support of music labels including Universal Music, Warner Music and Sony for any takeover, having already bought HMV Canada in 2011.Hilco is thought to have the support of music labels including Universal Music, Warner Music and Sony for any takeover, having already bought HMV Canada in 2011.
It is thought that RBS and Lloyds were owed around £30m each as HMV's biggest secured creditors. It is not known how much Hilco paid to take control, but it is expected to be well below the £60m the banks were owed.It is thought that RBS and Lloyds were owed around £30m each as HMV's biggest secured creditors. It is not known how much Hilco paid to take control, but it is expected to be well below the £60m the banks were owed.
The 930 job losses – the first shop floor redundancies at the firm – add to the 190 axed staff at HMV's head office and distribution arm and led to the company's official Twitter account being hijacked by soon-to-be sacked staff who live-tweeted their meeting with HR to learn their fate. The 930 job losses – the first shopfloor redundancies at the firm – add to the 190 losses at HMV's head office and distribution arm and led to the company's official Twitter account being hijacked by soon-to-be sacked staff who live-tweeted a meeting with HR at which they learned their fate.
This included "There are over 60 of us being fired at once! Mass execution, of loyal employees who love the brand. #hmvXFactorFiring"This included "There are over 60 of us being fired at once! Mass execution, of loyal employees who love the brand. #hmvXFactorFiring"
Followed by: "Just overheard our Marketing Director (he's staying, folks!) ask "How do I shut down Twitter?"Followed by: "Just overheard our Marketing Director (he's staying, folks!) ask "How do I shut down Twitter?"
Later on, the employee, identified as Poppy Rose, said: "I hoped that today's actions would finally show them the true power and importance of Social Media, and I hope they're finally listening."Later on, the employee, identified as Poppy Rose, said: "I hoped that today's actions would finally show them the true power and importance of Social Media, and I hope they're finally listening."