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Sony reportedly bidding for HMV’s MAMA, as OpCapita buys Game UK
By CMU Editorial | Published on Monday 2 April 2012
Sony Music is among those bidding for the MAMA Group, according to a report in The Independent. The major labels joins live music firm AEG Live and Time Out owner Oakley Capital in reaching stage two of the bidding, if the broadsheet is to be believed.
When HMV first announced it was considering selling its live music division late last year various music firms were tipped as possible buyers including, from the record industry side, both Sony and Warner, though it’s the former that is reportedly making a serious bid to acquire the venue owner, festival promoter and artist management group.
It would be an interesting move on the Sony music company’s part which – apart from its stake in the albeit significant Syco empire – has generally done less to diversify out of the traditional recorded music market than the other three majors.
It would give the world’s second biggest player in music a notable presence in both the live and management domains in the UK, and could potentially form the basis of a new Sony unit that could be expanded globally, to take on Universal Music’s dabblings in the live and management sectors.
Various sources reckon that, despite there being multiple bidders for HMV’s profitable live music business, the flagging retail firm is only likely to make a nominal profit on the £64 million it paid to buy MAMA in January 2010. There had been early speculation HMV could make a tidy profit by reselling its two year old acquisition at this time.
HMV, of course, just wants to reduce its debt burden overall to keep nervous bankers on side as its retail business continues to slide, though – as previously noted – by selling off MAMA and possibly its stake in 7Digital, while the retailer may get a short-term boost, long term prospects remain bleak.
Arguably the most interesting development at HMV in recent years was its diversification into live and digital ventures, and if now left with just its core high street store network and lacklustre accompanying online etail operation, it’s not clear how the 90 year old company will survive as conventional high street shopping dies a death. Unless selling tablets and headphones really is the goer HMV management continue to claim that it is.
Despite being decent enough not to gloat about it in public, HMV bosses had presumably hoped that their stores might get a little boost if their main rival in the video games space, Game, disappeared off the high street, which it looked like it might when the gaming retailer went into administration last month.
However, yesterday it was confirmed that OpCapita, the company that rescued the Comet chain last year, had done a deal with administrators PricewaterhouseCoopers that will keep the games retailer in business, albeit in a stripped down form. Just over half of Game’s 600+ UK store network will stay open in a deal which sees money lenders write off half their debts and suppliers owed about £40 million between them receiving nothing. But the deal will keep 333 stores open and 3200 employees in work. It remains to be seen if there are any buyers for any of Game’s non-UK stores.
