Deloitte takes over running of vid company
LONDON — Just one day after HMV, the U.K.’s biggest entertainment retailer, went into administration, home entertainment rental firm Blockbuster U.K. has announced that it has also gone into administration, the equivalent to Chapter 11 bankruptcy protection in the U.S.
Accountancy firm Deloitte, which is also acting as administrator for HMV, will take over the running of the company, which has 528 stores and 4,190 employees, while looking for potential buyers.
The beleaguered rental chain, which has had a presence in the U.K. since 1989, has suffered from the ever growing competition from internet-based rental and subscription services such as Amazon’s Lovefilm, Tesco’s Blinkbox and Netflix, which entered the U.K. market in January 2012.
“We are working closely with suppliers and employees to ensure the business has the best possible platform to secure a sale, preserve jobs and generate as much value as possible for all creditors,” said Lee Manning, a partner in Deloitte’s Restructuring Services practice. “The core of the business is still profitable and we will continue to trade as normal in both retail and rental whilst we seek a buyer for all or parts of the business as a going concern.”
Blockbuster LLC, the U.S.-based parent, filed for Chapter 11 in September 2010 and was acquired at auction by U.S. telecoms and media group The Dish Network in April 2011.