2,000 Blockbuster jobs and 264 stores saved after Gordon Brothers Europe buyout

Blockbuster UK has been sold to investment firm Gordon Brothers Europe (PA)

Ailing DVD and games rental chain Blockbuster has been sold to an investment firm in a move that will save 2,000 jobs and 264 stores.

The retailer’s British arm went into administration in January after struggling to fend off competition from Internet rivals such as Netflix, Amazon’s LoveFilm and iTunes.

But now restructuring specialists Gordon Brothers Europe have purchased the firm for an undisclosed sum, administrators from Deloitte have announced.

“Having identified a profitable core portfolio of stores we are pleased to have achieved this sale for creditors,” said Deloitte’s Lee Manning.

“Together with the previously announced store sales more than half of the original estate has been secured for ongoing use. This transaction provides Blockbuster a future in the UK and we owe a special vote of thanks to all the company’s employees, suppliers and customers for helping us rescue the business.”

The new owners will retain 264 of Blockbuster’s 528 stores, and almost half of the 4,190 staff will keep their jobs.

Frank Morton, chief executive officer of Gordon Brothers Europe, insisted there “is still a market to be served” despite ample evidence suggesting that Internet businesses will continue to lay waste to the high street.

Almost 7,000 staff at the now defunct electricals group Comet lost their jobs last year, while 1,370 workers at camera specialists Jessops found themselves without a job after the firm was closed in January.