Financial Problems
On 27 December 2006, the Bank of Ireland withdrew its loan and future working capital facilities and decided to recover its debts without notice and with immediate effect. As a result, on 3 January 2007, Music Zone went into administration with 31 stores across the UK closing two weeks later. The cause of the collapse was attributed to "challenging trading conditions and weak pre-Christmas trading, amid increasing competition and aggressive pricing across the DVD and music market." By 26 January 2007, all stores were closed. Music Zone's Head Office was closed on 30 January. By the time of closure, the company debts totalled ₤31 million.
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