DVD AND video games rental firm Blockbuster UK plunged into administration yesterday, putting a further 4,000 jobs at risk in a bleak week for UK retail.
The collapse came just 24 hours after the high street was dealt a massive blow when HMV threw in the towel and appointed administrators to a business which also employs more than 4,000 staff.
Administrators Deloitte said the demise of Blockbuster was as a result of increased competition from internet firms and a massive shift towards digital streaming of movies and games.
The Uxbridge-based business which opened its first store in London in 1989 trades from 528 outlets across the UK and employs a total 4,190 staff.
The firm’s retail estate includes two stores in Dundee and outlets in Forfar, Arbroath, Montrose, Kinross, Dunfermline and Rosyth, although the exact number of staff employed by Blockbuster in Tayside and Fife was unclear last night.
Deloitte which is also handling the administration of HMV said the firm would continue to trade during administration and would accept gift cards and credit bought through its trade-in scheme for second-hand movies and games, as well as operating its loyalty scheme.
They also stressed Blockbuster’s core business was profitable and said they would be looking for a rescue deal for all or part of the firm as a going concern.
Lee Manning, joint administrator and partner in Deloitte’s restructuring services practice, said: “In recent years Blockbuster has faced increased competition from internet-based providers, along with the shift to digital streaming of movies and games.
“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.”
Blockbuster’s US parent went bankrupt in 2011 but was rescued by US pay-TV provider Dish Network in a $320 million (£200m) deal, which saved hundreds of stores from closing and prevented tens of thousands of US job losses.
The UK group has sought to branch out in recent years in an attempt to revive business, including expanding its online rental offering and launching a trade-in service for pre-owned titles, allowing members to swap second-hand games and movies for cash or credit.
Blockbuster will continue to accept gift cards and credit bought through its trade-in scheme, as well as operating its loyalty scheme.
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