HMV has sold its Waterstone’s business for 53m.
It’s significantly more than the 35m mooted by the national press earlier this week.
The book store has been sold to major HMV shareholder Alexander Mamut’s company – A&NN Capital Fund Management.
It’s a major move for HMV, which is trying to strengthen its capital structure and reduce its borrowing requirements.
The sale lets the company switch its focus to the remaining HMV Group and turning it into a ‘broad-based entertainment business’, that now includes music venues, tickets, cinemas as well as retail.
HMV has hit troubled times recently, issuing multiple profit warnings as the company struggles to compete in a challenged market, with aggressive rivals and a growing emphasis on digital downloads.
HMV CEO Simon Fox said: "Having fully explored the options available to it, the Board believes that a sale of Waterstone’s to Alexander Mamut provides a good new home for the business. We expect this deal to enable the Group to achieve a reduction in the Group’s borrowing requirements, and, in turn, focus on plans for transforming the HMV Group into a broad-based entertainment business.
Waterstone’s is a great business with high quality people who have tremendous passion for bookselling. The Group is grateful for their contribution and wishes the team continued success. I am confident the deal will enable Waterstone’s to go forwards and to remain at the heart of bookselling in the UK for a very long time to come."
New Waterstone’s owner Alexander Mamut added: "We are extremely pleased to have reached an agreement to acquire Waterstone’s and its great heritage. I believe that our investment and strategy will secure a dynamic future for the UK’s largest bookshop chain and I look forward to working with its booksellers in building on the principle of excellent bookselling which is at the very heart of the business.”
The sale is expected to be completed by June 2011.