Private equity firm unwilling to increase bid
Private equity firm Permira has decided to walk away from its offer for the HMV Group. The decision follows the HMV board's rejection of Permira's second offer of 210p per share last Monday. Permira said it was disappointed by the response from the board.
Analyst Steve Davies from Numis Securities said he does not expect anyone else to target the retailer. 'HMV is a structurally challenged business and we expect its profits to decline in perpetuity as it continues to lose market share to online retailers, downloading and the supermarkets, leading to further erosion of the gross margins,' he said.
Permira has reserved its right to bid again if another bidder emerges.
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