HMV sells Japan business for £70m

August 1, 2007 - 0:0

TOKYO (BBC) -- Music and book retailer HMV is to sell its Japan business for £70m.

The firm said that the deal, with DSM Investment Catorce, would allow it to focus on countries where it was a market leader.
Last month HMV revealed profits had more than halved as it battled against competition from supermarkets and online retailers.
Opening in Tokoyo's Shibuya district in 1990, HMV Japan now has 62 stores, with about 40 million visitors a year.
Chief executive Simon Fox said that proceeds of the sale would be used to pay down debt, and that the deal represented the best value for its shareholders.
Globally, HMV made pre-tax profits of £48.1m before exceptional items in the year to 28 April, down from £98.2m a year ago. This was despite sales growing by 3.8% to £1.9bn.
HMV, which launched a recovery drive in March, earlier said that changes in music retailing had been ""more severe than predicted"" with CD sales suffering the most.
Along with other music retailers, it is trying to reduce their our dependence on the sale of physical music such as CDs.
These efforts include selling digital downloads in store and continuing to expand its online business
HMV is also increasing the range of items it sells to include MP3 players and DAB radios, and will allow mobile phone firm 3 to open concessions in some of its stores.
HMV is not the only music chain looking to cut costs, with Virgin reported to be keen to sell some of its stores.
Retailer Fopp went into administration last month as it struggled to cope with industry changes.