The music retailer HMV continues to be danger of closing as sales continue to decline. The owners of the retailer have announced that profits will not be as expected and that the demand the for download music has led to the decrease in music. CD sales have decreased year on year ever since legal download music has been launched. The retailer had attempted to diversify into other areas but it appears that this is now failing, the owners are now looking to offload certain parts of the business. Closure of the HMV chain would leave the UK high street without a chain of music focused stores.
The organisation is publically owned and therefore shareholder agreement must be gained before any decisions can be made. Recently there has been an agreement between shareholder to sell off the book chain Waterstone’s. This chain makes the most money and it is believed that the profits from these stores have been bank rolling the HMV chain. It is anticipated that the Russian tycoon Alexander Mamut will but the book chain Waterstone’s for £53 million.
A general meeting was held in order to gain votes from shareholders in regards to the sale of Waterstone’s. A vote was cast and 99.5 per cent of shareholders were in favour of disposing of the book chain.
Despite gaining authorization from the shareholders there is still a final hurdle to overcome. This includes announcing to the markets that they anticipate to sell the Waterstone’s chain. The music chain HMV is anticipated to release its full year results next week.
HMV have been hit hard by a fall in CD and DVD sales, there are strong worries that the chain will close in the near future. Numerous stores have been booming despite the decrease in sales, those stores which have been successful include Amazon and The Hut.