There are growing hopes this morning that some of HMV may be saved.
ERTonline.co.uk reports that administrators Deloitte say they are “working closely with management and staff to stabilise the business in order to continue trading while actively seeking a purchaser for the business and its assets”.
According to Deloitte, certain subsidiaries of the brand, including HMV Guernsey, HMV Hong Kong, HMV Singapore and 7Digital Group, remain outside the insolvency process, offering some hope for its future.
More after the break
But HMV Ireland has been placed in receivership today with 16 stores closing and the loss of 300 jobs.
If no buyer is found for the rest of the business, the closure of HMV would put 4,123 jobs at risk across its 233 stores in the UK.
In a conference call with journalists this morning, the management of HMV said it is "working on options" to find "a successful business outcome" to the current situation.
While admitting that the decision to go for administration came as a shock to many, boss Trevor Moore said he is "confident" that a solution to keeping HMV on the high street – in some form or other – can be found.
Trading was disappointing over Christmas, so the management's hopes of turning things around faded away. But the firm still believes there is a future for the business given that physical (disc) music sales still make up 75% of the market.
HMV says it is working out how many people have gift vouchers they can't use, saying many of them were used up last week.
Published 14.01.13: A statement from the HMV board has confirmed HMV is going in to administration.
"The Board regrets to announce that it has been unable to reach a position where it feels able to continue to trade outside of insolvency protection, and in the circumstances therefore intends to file notice to appoint administrators to the Company and certain of its subsidiaries with immediate effect.
"The Directors of the Company understand that it is the intention of the administrators, once appointed, to continue to trade whilst they seek a purchaser for the business."
HMV is set to go in to administration according to news reports tonight, with a formal announcement expected later.
The music, film and games retailer has struggled to compete with online retailers such as Amazon, and posted debts of over £176 million in its company reports in October last year.
FT journalist Rob Budden suggested the company had failed in an attempt to raise funding from music labels, film companies and games makers for a new business model.
The BBC reports Deloitte is being lined-up to run the company's 239 stores, with the jobs of HMV's 4,350 staff potentially at risk.
HMV has been in trouble for some years now due to dwindling sales and rising debts, with its share price plumetting over the last 3 years.
Despite this, its share of downloaded and physical music and films was still 22.2% in 2012 in the UK, according to Verdict.
Last year, the company pinned hopes on the lucrative Christmas period only to have hopes dashed by an 8% fall in sales.
Going in to administration will not necessarily mean the end of HMV shops, however, the administrators have the option to keep selling goods. At the time of writing the HMV website is down.