Canada’s Sunrise Records Buys Part of U.K.’s Ailing HMV Chain

(Bloomberg) -- Sunrise Records, a Canadian chain of record stores, agreed to buy most of HMV Group Plc in an auction overseen by the embattled music retailer’s administrators, fending off a rival bid by retail magnate Mike Ashley.

Douglas Putnam, who runs Sunrise and bought HMV’s Canadian unit in 2017, will gain control of 100 stores across the U.K., KPMG LLP said Tuesday. The remaining 27 shops will be shut down, putting 455 employees out of work.

HMV, which employs about 2,000 people, began insolvency procedures in December for the second time in six years, as compact discs have become outmoded in favor of online music streaming. Sunrise is betting that there’s enough of a market niche that some shops will survive.

“The physical media business is here to stay,” Putnam said in a statement.

The Canadian entrepreneur is entering a market fraught with challenges as the U.K.’s impending exit from the European Union weighs on consumption. Debenhams Plc is struggling to pay off debt, while online retailer Ocado Group Plc reporting earnings that missed analysts’ estimates Tuesday.

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