HMV changes hands for HK$408 million

HMV, Hong Kong’s largest music and DVD retailer, has changed hands, with China 3D Digital Entertainment paying AID Partners Capital HK$408 million for an 81.63 per cent stake, the two companies said in filings to the stock exchange on Tuesday morning.

Growth Enterprise Market-listed film-maker China 3D Digital will issue 1.12 billion shares to AID Partners, representing 22.59 per cent of the enlarged issued share capital of China 3D Digital. Upon completion of the deal and shareholders’ approval, the company’s name will be changed to HMV Digital China Group.

GEM-listed AID Partners, a buyout firm focused on the film and entertainment business, will become China 3D Digital’s single largest shareholder. It reported a gain on the disposal of approximately HK$224 million before tax and transaction costs.

The deal was announced before the market opened and prompted China 3D Digital shares to rise 12 per cent to 51 HK cents by the close. AID Partners shares rose 1.4 per cent to close at 21.7 HK cents.

When British retailer HMV went into administration in January 2013, AID Partners bought HMV’s operations in Hong Kong and Singapore and the rights to develop the brand on the mainland and in Taiwan and Macau.

AID Partners chief executive and executive director Kelvin Wu King-shiu said China 3D Digital was a pioneer in the media and entertainment industry in Hong Kong and in mainland China.

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“China 3D Digital shall further accelerate the vertical integration process of HMV and grow into one of the very few entertainment platforms, which has the combined characteristics of local culture and international perspective; thus maximising its overall profitability,” Wu said.