Zavvi completely phased out in the U.K.
446 jobs will be cut as last stores closeLONDON -- U.K. entertainment retailer Zavvi will disappear from the U.K. high street this week, following the sale of a number of stores to rival HMV and a new venture led by former Zavvi chief executive Simon Douglas.
Zavvi will cease trading and all remaining stores will close on Feb. 20 with the loss of 446 jobs.
The entertainment retailer went into administration on Dec. 24 -- a move equivalent to Chapter 11 bankruptcy protection -- following supply problems with the wholesale distributor EUK. The Woolworths Group-owned supplier was also in administration and the stock it holds is now being sold off.
Zavvi had 125 stores in the U.K. and Ireland on Dec. 24, but that was down to about 30 before the announcement Wednesday.
Joint administrators Ernst & Young said in a statement that 360 jobs are expected to be saved following sale agreements with HMV Music Limited and Head Entertainment LLP. HMV is taking on five more stores following its purchase of 14 stores last month.
Tom Jack, joint administrator, said in a statement: "This is a fantastic result for the employees and customers of the stores concerned.
"Another five stores have been sold to HMV, meaning 111 employees will transfer across to HMV immediately and over the course of the next two weeks these Zavvi stores will be rebranded as HMV. In total, HMV has purchased 19 stores in the U.K. and Ireland securing jobs for 380 employees."
Five stores have also been sold to Head Entertainment LLP -- known as "Head" - with a further three stores expected to complete by Feb. 20. This would ensure the transfer in total of another 249 jobs in a deal that also includes the sale of all remaining Zavvi stock.
Head, a business led by Les Whitfield and former Zavvi chief executive Simon Douglas, is expected to continue to trade the stores using the stock purchased in this deal and from other sources.
"I would like to thank all of Zavvi's staff and customers for their commitment and continued support for the business throughout the administration," added Jack. "Whilst it has not been possible to secure a sale of the business as a going concern, we are delighted to have been able to secure continued employment for 629 Zavvi employees."