Zavvi goes into adminstration

Zavvi, the music, DVD and CD high street chain has gone into administration, Ernst & Young has announced, threatening thousands of jobs.

The chain, which bought Virgin Megastores last year, stopped taking orders on its website at the beginning of December and now appears to be struggling on the high street as well.

Zavvi, was heavily affected by the Woolworths' collapse. It was the main supplier of the retailer's stock when Entertainment UK - a unit of Woolworths, went into administration on 26 November.

According to the BBC, all of Zavvi's stores should be open as normal on Boxing day, for its traditional post-Christmas sale.

Tom Jack, joint administrator, said: "In the absence of a buyer for EUK, and with dire trading conditions on the high street, the Zavvi group has seen a material fall in sales and the directors have now been forced to place parts of the group into administration".

With 125 stores, Zavvi is the UK's largest independent entertainment retailer, the administrators intend for Zavvi to continue trading with a view to selling all or part of the business.

Zavvi is the latest CD, Music and DVD chain to go into administration as it feels the pinch from online sites like play.com and amazon.co.uk. Last year rivals Fopp and Music Zone both disappeared from the high street.