Entertainment retailer HMV has announced it intends to transfer its listing on the Stock Exchange from premium to standard to make it easier to hive off its live music businesses.
The company said the change will give it more regulatory flexibility to dispose of the business in a “timely and effective manner,” according to The Retail Bulletin.
As a standard listed company, HMV said it would be able to implement any disposals associated with the strategic review of its live business faster and at lower expense, and without the need to seek shareholder approval in respect to the disposals.
As a premium listed company, HMV has to seek prior shareholder approval in connection with the acquisition or disposal of assets that exceed certain size criteria or involve a transaction with a related party.
“The Board believes this transfer will facilitate a more cost efficient and timely strategic review of the live business and reduce administrative costs generally,” HMV said in a statement. “Furthermore, the Board wishes to align its regulatory responsibilities and the associated costs thereof with the company’s size.”
However, HMV is sending out a circular and notice of a general meeting to its shareholders that contains full details of the proposed transfer, which still needs the approval of 75 percent of its shareholders.
Several companies have been linked with HMV’s live portfolio, which includes a handful of London venues such as the HMV Forum, Heaven, The Garage, Barfly Camden, Jazz Café and The Borderline, regional venues such as the Manchester’s HMV Ritz, Edinburgh’s HMV Picture House, and the HMV Institute in Birmingham, and UK festivals including Lovebox, The Great Escape, Wilderness, Vintage and Global Gathering.
LDC, the buyout firm owned by taxpayer-backed Lloyds Banking Group, is reportedly in talks to buy some of HMV’s live music assets, but most business analysts believe the package will likely go to a group led by MAMA Group co-founder and chief exec Dean James.
James moved to HMV when it bought out MAMA for £65 million ($102 million) in 2010.