HMV sells off more of its live business
LONDON (Reuters) - Struggling British entertainment retailer HMV HMV.L sold off a further chunk of its live business on Monday to cut debt and said more disposals would follow.
HMV, famous for its Nipper the dog trademark, is battling declining music, DVD and games markets and is focused on shifting to growth areas such as new technology products, as well as selling off non-core parts of its business.
The firm said it had sold MAMA Group and a 50 percent interest in ticket seller business Mean Fiddler to a subsidiary of Lloyds Development Capital for 7.3 million pounds ($11.70 million) although 3.5 million of it will be deferred for a year. HMV bought MAMA in 2010 for 46 million pounds.
Proceeds from the sale of MAMA, which owns London venues such as the HMV Forum and the Jazz Cafe, as well as festivals including Lovebox and Global Gathering, would be used to pay down debt, HMV said, which stood at 166.7 million pounds at the end of its 2011-12 year.
Talks to sell the G-A-Y and Heaven clubs - the remaining parts of its live business - were ongoing, it added.
The sale follows the disposal of its London Hammersmith Apollo live entertainment venue in May for 32 million pounds - a move which allowed the group to amend and extend its existing 220 million pound bank facility.
HMV, which made a loss of 16.2 million pounds last year has forecast a return to profit in the 2012-13 year, reflecting disruption to rival computer games retailer Game and better terms with key suppliers.
It is expected to publish half-year results before Christmas.
Shares in HMV were down 6 percent at 2.425 pence, valuing the business at about 10 million pounds.
($1 = 0.6240 British pounds)