Virgin Megastores sold to management

Virgin Megastores has been sold as part of a management buy-out, led by managing director Simon Douglas and finance director Steve Peckham, and will be rebranded Zavvi.

The buy-out team, Zavvi Entertainment Group, has bought the 125-strong retail chain from Sir Richard Branson’s Virgin Group to create the UK and Ireland's largest independent entertainment retailer. The group’s existing UK stores will be renamed by November and its recently revamped web site, along with its Irish stores, will be rebranded in January. Zavvi will continue to be supplied by Entertainment UK, the company's primary supplier.

Managing director of the new company Simon Douglas said: “We have a workforce of 2,500 people who are absolutely passionate about the products we sell and we will continue to harness that passion and energy. With an independent ethos and modern outlook, we will deliver a new brand that lives and breathes entertainment and delivers a high-quality service to customers.

“This deal secures an exciting future for Zavvi and all our staff. Despite escalating competition, there is still very much a place on an increasingly homogenised high street for an independent entertainment specialist that puts customers, product, service and personality at the top of the agenda.”

Branson, chairman and founder of the Virgin Group, said: “In the past six years, we have been withdrawing from entertainment retailing, which is no longer viewed as core to the group's future. We now choose to franchise our global entertainment retail operations, rather than own them, and this was the last significant wholly-owned Virgin retail business in the world.

“The Virgin brand will continue to be represented in-store through the Virgin Mobile and Virgin Media in-store concessions.”