Gordon Brothers Europe has filed a notice of intention to appoint an administrator on behalf of UK film and game rental business Blockbuster UK.
Gordon Brothers Europe, a wholly owned subsidiary of global advisory, restructuring and investment firm Gordon Brothers Group, bought the UK arm of the film and game rental business in March, after the business went into administration in January. It used a subsidiary, TS 1973 Investment Holdings Limited, to make the acquisition.
The firm put in a “substantial investment” and promised to “bring new life to this high street staple”.
Yet there was to be no happy ending for the film rental business. “The acquisition coincided with a period of poor trading performance across both rental and retail sales,” Gordon Brothers Europe said in a statement.
“The company has striven to turnaround the historically loss-making company by restructuring the business, investing significantly in strategic marketing activities and negotiating with the landlords of its retail outlets,” it added.
The firm also tried to develop a new digital platform, but was unable to broker a licensing deal with Blockbuster UK’s parent company in the US.
“Since the acquisition we have worked extremely hard to reignite the Blockbuster brand, make our investment work and put the business on a viable footing. Despite our best efforts, we regret that we are now forced to make some redundancies and would like to thank any affected employees for their support during the last six months,” said Frank Morton, chief executive officer at Gordon Brothers Europe.
The firm will now focus on giving the company “a chance of future survival” in the hope that a buyer will be found. There will be 32 immediate redundancies at Blockbuster UK’s head office. Blockbuster UK, which has 264 stores and 2,000 staff, will continue trading as normal as it searches for a buyer.