Up to 300 jobs are under threat at HMV stores in Ireland following the announcement that the company is poised to go into administration in the UK where 4,000 jobs are at risk.
The music, film and games retailer has 16 stores in the Republic and ten in Northern Ireland. HMV in the Republic and the UK is one trading company.
HMV said it was calling in the administrators after a last-ditch attempt to secure funding failed,.
The move brings the curtain down on one of Britain's best-known high street retail stores. Its shares were suspended on the London stock exchange.
The accounting firm Deloitte has been named as the administrator and intends to keep the business running while it seeks a potential buyer, HMV said in a statement late last night.
The company has struggled amid declining music, DVD and games markets. In December, it warned that a breach of its banking agreements was likely and it had been in talks with its banks to remedy the breach, it said yesterday.
"However, 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," HMV said.
The company's chief executive is Trevor Moore, who joined HMV last year from camera specialist Jessops, which last week also went into administration.
He said he was sure an administration process would result in the survival of the 92-year old firm in some form.
"I'm confident that we will find a solution," the CEO told reporters today.
"We remain convinced that we can find a successful business outcome. We know that HMV is a well loved brand, which has a high level of support amongst the public and we want to ensure that it remains on the high street," he said.
Moore said he and Finance Director Ian Kenyon had begun working with the administrators Deloitte to evaluate options for HMV, with a focus on safeguarding jobs. He said the intention was to continue to trade HMV's 239 stores.
The economic downturn and tough government austerity measures have hit consumer spending and confidence in Britain, and a string of once well-known retail names has disappeared in recent years.
HMV opened in London in 1921
Opened on London's Oxford Street by English composer Edward Elgar in 1921, HMV, famous for its 'Nipper the dog' trademark, grew to become a musical powerhouse, selling records and albums to generations.
The firm had a hand in the Beatles' big break 40 years later, recommending the group's demo record to publishers. It underlined its status as an industry figure by opening the world's biggest music entertainment store in London in 1984.
The 1990's signaled major expansion as HMV opened abroad and branched into books and then live music venues and festivals. In 2006, it even rejected a private equity takeover bid valued at £847m sterling, before the rise of online and digital music - and its failure to adapt quickly enough - spelled the beginning of its struggles.
A rapid fall in the sales of physical CDs has seen rivals like Zavvi go bust or others like WH Smith exit the market.
With DVD and games demand also in decline, HMV belatedly tried to shift its focus toward technology products like tablet PCs and headphones, but it faced tough competition to prise sales away from online firms like Amazon at a time when pressured consumers are eager to save money.
The support of suppliers - music labels, games manufacturers and others who look to HMV as one of the last bastions of entertainment content on the high street - has been crucial. As its debt rose - underlying net debt stood at £176m at its half year to October 27 - the company sold off much of its live entertainment business. It had disposed of the book chain Waterstones in 2011.
HMV had been pinning its hopes on a late Christmas surge in sales, but it sparked worries last week that such a surge had not materialised when it launched a month-long sale on some products, sending its shares to an all-time low.
HMV's shares have lost more than 90 per cent of their value since their peak in 2005 and they shares closed 8.3% lower to just above a penny a share yesterday, valuing the company at around £5m. Its shares were suspended ahead of today's opening in London.
The fate of its retail outlets in Ireland is not expected to become clear until administrators Deloitte have assessed the company's position.