Troubled HMV agrees financing deal

Embattled retailer HMV said today that it had agreed a refinancing deal which will secure its immediate future.

Its banks, which include taxpayer-backed Lloyds Banking Group and Royal Bank of Scotland, have agreed to extend it a £220m (€246m) lending facility for the next two years.

The deal includes issuing the lenders with warrants worth 5% of the company, which will be converted into shares next year.

Simon Fox, HMV’s chief executive, said the new banking facility was another important milestone in securing the financial stability of the group, which has issued several profit warnings this year.

The continued support of HMV’s lenders follows the recent sale of HMV’s book shop business Waterstone’s to Russian billionaire Alexander Mamut for £53 million.