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HMV sale livens up

Posted in Live, News by Generator on Tuesday 10th of January 2012

As speculation builds, Live Nation, AEG, Sony and Warner Music are all reportedly in the frame for the potential sale of HMV’s live division.

As previously reported, the troubled retailer admitted at the end of last year that such a sale was probable after announcing losses of £36m in the first half of its financial year. To add to the retail gloom, HMV’s pre-Christmas sales dipped by 8.2% year on year.

HMV said in a statement last month: "The Board has initiated a strategic review of HMV Live which may lead to its sale, the proceeds of which would strengthen the financial position of the Group”.

HMV live includes all venues operated by MAMA Group. Although their portfolio is mainly London based, MAMA operates 13 venues throughout the UK including Hammersmith Apollo, The Picture House in Edinburgh and The Institute in Birmingham.

HMV CEO Simon Fox recently told Music Week that he was confident that the sale would raise more than the £60m than HMV paid for MAMA in 2007.

Fox also said: "The continuing actions to focus the business and to expand our technology offering are beginning to show through. We are seeing a combination of a slowing of the decline in music and film, and acceleration in the growth of technology. Undoubtedly trading conditions and the consumer environment remain challenging, but we remain confident in HMV's future prospects".

The plan seems to be that the sale of the profitable live division would buy some breathing space in which HMV’s technology sales strategy could be fully rolled out, but with Fox admitting that other entertainment industries such as video games have been largely unsupportive of HMV’s expansion beyond music and film sales, this could prove to be their final gamble.

Time Out magazine owners Oakley Capital are also in the picture for the potential sale but HMV’s live interests are surely more likely to be sold to a company who already have a significant stake in the live business, putting Live Nation or AEG at the forefront.

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