HMV agrees takeover of live music group

Music and games firm HMV today shored up its position in the growing live music market after agreeing a £46m (€51.46m) takeover of MAMA Group.

The move comes less than a year after HMV and MAMA formed a joint venture which owns 11 music venues and an interest in events such as London's Lovebox festival.

HMV, which already owns 9.9% of MAMA, said it had support from investors representing almost 34% of MAMA's shares.

The deal trumps a previous £38m (€42.5m) unsolicited approach from MAMA's largest shareholder, Luxembourg-based investment firm SMS Finance, two weeks ago.

The 11 venues owned by the Mean Fiddler joint venture are the Hammersmith Apollo, the Forum, the Garage, Jazz Cafe, Heaven, G-A-Y Bar, G-A-Y Late, and the Borderline in London, as well as the Edinburgh Picture House, The Birmingham Institute, and Aberdeen's The Warehouse.

HMV's move into the live music business forms part of the fightback plan engineered by chief executive Simon Fox in 2007, when the business was being hit badly by online music downloads.

The company expects to open further venues to capitalise on the growing popularity of live music as well as growing its current ticketing business and promoting gigs and festivals through its store network.

Recent results from MAMA showed further strong growth in gig demand, with trading at the Hammersmith Apollo - the joint venture's flagship 5,100 capacity venue - at record levels.

Alongside MAMA's 60% stake in Lovebox - which saw its best-ever attendance this year - the group owns festivals in Stratford and Swansea, as well as the Great Escape festival in Brighton.

The group also boasts an artist management business which represents top bands including the Kaiser Chiefs, Franz Ferdinand and White Lies.

The business was set up in 2002 and bought venues from the Mean Fiddler group - including the rights to the brand - in 2007.

Joint chief executives Adam Driscoll and Dean James said the tie-up with HMV had worked "extremely well" since January.

"We believe there are even greater opportunities to develop and evolve the live music operations, alongside our artist services business, within the HMV group of businesses," they said.