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EMI TO DIVEST IN HMV
As Retailer Goes Public,
Music Giant to Sell Off Shares
In what is seen as another attempt to strengthen its balance sheet, EMI Group will sell off a portion of its 42.7% stake in HMV when the U.K. music retailer goes public on the London stock exchange next month.

The move will likely see EMI’s holdings in HMV drop to 20-25% as EMI has stated that its holding is a non-core asset.

On Thursday, HMV confirmed its plans to float by the end of June. HMV is expected to raise up to $863.4 million (600 million pounds) through an initial public offering that would value the company at approximately 1 billion pounds.

For EMI, selling a portion of its shares is a no brainer, as the U.K. music giant has been in the midst of trying to reduce short-term debt and raise cash flow.

"We believe that HMV has an excellent business and strong growth prospects, and expect to continue as a significant shareholder in HMVB following the flotation," said EMI Chairman Eric Nicoli.

The latest move follows months of redesign and restructuring at EMI that saw the company lay off 1,500 staffers worldwide. Those moves are expected to result in an annual savings of more than $140 million. The cutbacks represented 10-15% of the company's then-workforce of approximately 9,000.

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