U-turn on HMV gift cards as its survival hopes improve

The administrator to HMV yesterday performed a major U-turn and said the failed retailer's gift cards could be redeemed in stores from tomorrow, as hopes were raised that the chain's 200-plus stores could remain on the high street in the short-term.

Deloitte is locked in talks with Hilco, the restructuring firm, about striking an unusual deal that would see it assist the administrators in running the UK retailer, while the accountants seek to complete a formal sale of HMV.

Denby Pottery owner Hilco, which acquired HMV Canada in 2011, also remains the front runner to acquire the UK chain. Its bid is apparently backed by a consortium of music and film giants, such as Warner Music and Sony Pictures, among others.

In a traumatic fortnight for the high street, the collapse of HMV last week was closely followed by the administration of the DVD rental firm Blockbuster, which already plans to shut 160 of its 528 shops.

Deloitte caused anger among shoppers by not honouring HMV's gift cards. At the time, Dean Dunham, the founder of youandyourrights.co.uk, said: "We've got to see some changes in this area. It's almost theft." He added: "A gift voucher should be as good as a banker's draft."

In an apparent response to the backlash, Deloitte yesterday said that all holders of HMV's gift cards will be able to cash them in at its stores from this morning. There are estimated to be up to £7m-worth of gift cards outstanding.

The accountancy firm also said proceeds raised by HMV through the sale of charity releases, including the Hillsborough Justice Collective single, will be paid "in full" as soon as possible.

Nick Edwards, the joint administrator, said: "We recognise that both of these matters have caused concern for individuals and organisations affected and are pleased to have reached a positive outcome."

HMV had kept accepting gift cards up until the afternoon of 14 January, the day before it formally fell into administration. While it is standard practice for administrators not to honour gift cards, Deloitte performed a similar U-turn following the collapse of the 236-store electricals chain Comet before Christmas. The accountancy firm explained that it had been "urgently" assessing the financial position of HMV, such as the value of outstanding gift cards.

Hilco, which declined to comment, remains in talks with Deloitte to hammer out a full-blown rescue deal for the retailer.

However, any such deal will be complex due to the large supplier base, HMV's debts of £176.1m and the fact it has a substantial number of loss-making stores. The eventual closure of some stores is inevitable.

The private-equity companies, Endless and Better Capital, and the restructuring company Gordon Brothers also remain interested in acquiring parts of HMV. The video games retailer Game, which is owned by distressed investor OpCapita, is looking at up to 45 stores.

Meanwhile, as many as 388 jobs could be lost after the Midlands Co-operative yesterday said it was closing nine of its department stores.

Voices
The Sumatran tiger, endemic to the Indonesian island of Sumatra, is an endangered species
voicesJonathon Porritt: The wild tiger population is thought to have dropped by 97 per cent since 1900
News
These photographs released by the University of Maryland Medical Center show images of full face transplant recipient 37-year-old Richard Lee Norris of Hillsville, Virginia
mediaGQ front page features man who underwent full face transplant
Sport
Lionel Messi looks on at the end of the final
football
Arts and Entertainment
tv
PROMOTED VIDEO
News
Prince Harry is clearing enjoying the Commonwealth Games judging by this photo
people(a real one this time)
News
Gardai wait for the naked man, who had gone for a skinny dip in Belfast Lough
newsTwo skinny dippers threatened with inclusion on sex offenders’ register as naturists criminalised
Life and Style
Attractive women on the Internet: not a myth
techOkCupid boasts about Facebook-style experiments on users
Sport
Van Gaal said that his challenge in taking over Bobby Robson's Barcelona team in 1993 has been easier than the task of resurrecting the current United side
football
News
The Swiss Re tower or 'Gherkin' was at one time the UK’s most expensive office when German bank IVG and private equity firm Evans Randall bought it
news
Sport
Moeen Ali wearing the 'Save Gaza' and 'Free Palestine' wristbands on his left arm
cricket
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Arts and Entertainment
The Great British Bake Off 2014 contestants
tv
Life and Style
tech
Arts and Entertainment
filmThe Battle of the Five Armies trailer released
News
news
Arts and Entertainment
Beast would strip to his underpants and take to the stage with a slogan scrawled on his bare chest whilst fans shouted “you fat bastard” at him
musicIndie music promoter was was a feature at Carter gigs
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

HR Business Partner (Maternity Cover 12 Months)

£30000 - £34000 Per Annum 25 days holiday, Private healthcare: Clearwater Peop...

Business Analyst - London - Banking - £400-£450

£400 - £450 per day: Orgtel: Business Analyst - Credit Risk - Banking - London...

Project Manager,Conduct Risk,London,£5-600pd

£500 - £600 per day + competitive: Orgtel: My client, a leading bank, is curre...

Senior Fund Administrator - Edinburgh - £22 p/hr

£20 - £22 per hour + competitive: Orgtel: Senior Fund Administrator, Top Four ...

Day In a Page

The children were playing in the street with toy guns. The air strikes were tragically real

The air strikes were tragically real

The children were playing in the street with toy guns
Boozy, ignorant, intolerant, but very polite – The British, as others see us

Britain as others see us

Boozy, ignorant, intolerant, but very polite
Countries that don’t survey their tigers risk losing them altogether

Countries that don’t survey their tigers risk losing them

Jonathon Porritt sounds the alarm
How did our legends really begin?

How did our legends really begin?

Applying the theory of evolution to the world's many mythologies
Watch out: Lambrusco is back on the menu

Lambrusco is back on the menu

Naff Seventies corner-shop staple is this year's Aperol Spritz
A new Russian revolution: Cracks start to appear in Putin’s Kremlin power bloc

A new Russian revolution

Cracks start to appear in Putin’s Kremlin power bloc
Eugene de Kock: Apartheid’s sadistic killer that his country cannot forgive

Apartheid’s sadistic killer that his country cannot forgive

The debate rages in South Africa over whether Eugene de Kock should ever be released from jail
Standing my ground: If sitting is bad for your health, what happens when you stay on your feet for a whole month?

Standing my ground

If sitting is bad for your health, what happens when you stay on your feet for a whole month?
Commonwealth Games 2014: Dai Greene prays for chance to rebuild after injury agony

Greene prays for chance to rebuild after injury agony

Welsh hurdler was World, European and Commonwealth champion, but then the injuries crept in
Israel-Gaza conflict: Secret report helps Israelis to hide facts

Patrick Cockburn: Secret report helps Israel to hide facts

The slickness of Israel's spokesmen is rooted in directions set down by pollster Frank Luntz
The man who dared to go on holiday

The man who dared to go on holiday

New York's mayor has taken a vacation - in a nation that has still to enforce paid leave, it caused quite a stir, reports Rupert Cornwell
Best comedians: How the professionals go about their funny business, from Sarah Millican to Marcus Brigstocke

Best comedians: How the professionals go about their funny business

For all those wanting to know how stand-ups keep standing, here are some of the best moments
The Guest List 2014: Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks

The Guest List 2014

Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks
Jokes on Hollywood: 'With comedy film audiences shrinking, it’s time to move on'

Jokes on Hollywood

With comedy film audiences shrinking, it’s time to move on