HMV has put its fast growing, most profitable business on the block to save the rest of the struggling company.
Citigroup has been drafted in to seek a buyer for its music venue and festivals business, HMV Live, in an effort to reduce its £163 million debt mountain.
HMV Live runs 13 venues, including the HMV Apollo in Hammersmith, and is behind festivals including Global Gathering and Lovebox. It achieved profits of £3.4 million for the first six months of this year, and could bring in £60 million if sold.
Pre-tax losses for HMV jumped to £36.4 million for the six months to the end of October from £27.4 million for the same period in 2010.
The Times reported that HMV said there were “material uncertainties which may cast significant doubt on the group’s ability to continue as a going concern in the future”.
HMV had taken steps to diversify away from its dropping CD and DVD sales by selling tech paraphernalia such as headphones and docks for MP3 players, after refitting 144 of its 252 stores to do so. Sales of tech items are said to have increased by 42 per cent.
The rise of online music sellers such as Play and Amazon, the diversification of supermarkets, and price under cutting have played a big part in the demise of the record store.
