Zavvi loss is "a watershed".

HMV could be only survivor as Zavvi administrators assess options

By Robert Ashton

THE INDUSTRY IS COMING TO TERMS with having just one major specialist music chain left on the high street with no concrete buyers emerging for the collapsed Zavvi.

Ernst & Young is continuing to keep the retailer trading after it went into the administration on Christmas Eve, with the administrators saying they have received "quite healthy interest" from parties wanting to buy the whole business or parts of it.

Those offers will be assessed over the coming days and weeks, although an Ernst & Young spokeswoman will not reveal where the interest is coming from.

ERA director general Kim Bayley is hopeful at least one will turn into a firm offer. "ERA firmly believes that not only is there room in the market for at least two specialist chains, but that a diverse retail landscape is an essential platform for future entertainment industry growth. This gives hope that Zavvi will trade out of administration or a buyer will be found."

Despite some encouraging figures from the high street over Christmas (see page 3), some retail experts suggest specialist music retailing is looking less tenable in the digital age and are unsure there will be much appetite to take on Zavvi in the current climate. This will put a question mark over the group's 2,363 staff at the groups 125 stores.