Suppliers deal boosts troubled HMV

The future of ailing music and film retailer HMV was looking more secure today after suppliers including Universal Music came to its rescue.

The loss-making group, which owns more than 260 stores in the Republic of Ireland and the UK, said it had signed better terms with key suppliers in a move which will ultimately help it shed around half of its £180m (€215m) debt pile over the next three years.

The deal is a sign that the music and film industry is willing to support high street retailers at a time when online shops provide intense competition and internet piracy damages trade.

The agreement was enough to persuade the banks – including taxpayer-backed Lloyds Banking Group – to amend existing loan agreements, giving the struggling group more financial headroom. Shares more than doubled following the announcement.