Retail Giant Faces Another Challenge
- Mike Ashley bidding to purchase HMV
- HMV fell into administration during festive period
- Denied £3.35m government tax cut before entering administration
- Retail challenges led to high property taxes
- Real estate adviser Altus Group said HMV should have seen lower business rates liabilities
- Sports Direct rescued Evans Cycles in September 2019 and acquired House of Fraser in August 2018
Sports Direct owner Mike Ashley is among bidders looking to purchase music and film retailer HMV, which recently entered administration for the second time in six years. The company faced high property taxes, paying £15m on sales of £277m with £1 out of every £18.5 going towards property taxes. Real estate adviser Altus Group stated that HMV should have seen a 19.4% decrease in business rates liabilities for 87 of its English stores under the 2017 revaluation. Sports Direct previously rescued Evans Cycles and acquired House of Fraser in August 2018.
Factuality Level: 8
Factuality Justification: The article provides accurate information about Mike Ashley’s interest in purchasing HMV and mentions relevant background details such as HMV’s financial struggles and Sports Direct’s previous rescues of other companies. It does not include any irrelevant or sensationalized content, nor does it present personal opinions as facts.
Noise Level: 6
Noise Justification: The article provides relevant information about Mike Ashley’s interest in purchasing HMV and mentions his past successes with rescuing other companies from administration. However, it contains some repetitive information and does not delve into the long-term trends or possibilities of HMV’s future. It also lacks scientific rigor and intellectual honesty by using sensational language like ‘tsunami’ to describe retail challenges.
Financial Relevance: Yes
Financial Markets Impacted: HMV, Sports Direct, Evans Cycles, House of Fraser
Financial Rating Justification: The article discusses Mike Ashley’s bid to purchase HMV and his previous involvement in rescuing Evans Cycles and acquisition of House of Fraser, which are all financial transactions involving companies in the retail sector. This impacts the financial markets as it involves changes in ownership and potential impact on their stock prices.
Presence Of Extreme Event: No
Nature Of Extreme Event: Other
Impact Rating Of The Extreme Event: Minor
Extreme Rating Justification: There is no extreme event mentioned in the text. The situation with HMV falling into administration is considered a minor impact due to financial nature and not causing significant deaths, injuries, or damage to infrastructure.
www.retailsector.co.uk 
