Blog: Asda "eyeing bid for UK music retailer HMV"
Michelle Russell | 12 March 2013
Supermarket giant Asda could be lining up a last minute rescue bid for UK music chain HMV if reports are to be believed.
The grocer is understood to have been in talks with HMV's administrators Deloitte about putting together a bid for the iconic brand, which collapsed into administration in January putting 100 stores at risk of closure.
According to The Sun, Asda could go head to head with restructuring experts Hilco in a race to grab the business. The restructuring specialist bought HMV's debt so is in pole position to acquire the retailer.
Asda, however, appears to have other ideas and could now launch a late bid to try to take control of the entertainment chain.
Shore Capital analyst Clive Black tells just-food: "There is no smoke without fire. I don't think someone has made up the story, which suggests there is some exploration going on on behalf of Asda."
Black believes it "makes sense" for Asda to consider buying the chain, for a number of reasons.
"I'm not sure whether Asda is coming at this with respect to ... buying HMV stores to turn them into city centre or retail park supermarkets or Asda Living stores. The devil is in the detail in that one.
"HMV is still a great brand. To me, it's about how much brand integrity is still in HMV and if it was properly looked after and invested in then it could deliver something for Asda. Could it replace the home entertainment areas of Asda? Could they change the profile and mix of the present HMV estate and take it internationally?"
Conlumino analyst Joseph Robinson believe the credibility HMV has built up in consumer electricals could be what is attracting Asda to the chain.
“These are areas that Asda has got a foothold in, as well as the strong brand position. There was talk at the end of last year that Asda was looking to follow Tesco and Sainsbury into possibly launching its own online downloads for music and video. So the HMV brand would help them do that.”
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