06/27/2011 07:17 EDT | Updated 08/27/2011 05:12 EDT

HMV Canada Business Sold To Restructuring Company

THE CANADIAN PRESS -- LONDON - Struggling music and games retailer HMV has agreed to sell its Canadian business to restructuring specialist Hilco UK for 2 million pounds ($3.2 million).

As part of the deal, HMV said Monday that it retains an undisclosed amount of debt owed by the Canadian unit, which operates 121 stores.

For the year ending 24 April 2010, HMV Canada generated sales of 222 million pounds (C$349 million) and reported an operating profit of 2.3 million pounds (C$3.6 million).

HMV previously announced the sale of its Waterstone's bookstore business in Britain as the company struggles to survive against competition from supermarkets, Internet retailers and new forms of music distribution.

HMV shares were down 0.6 per cent at 9.39 pence in morning trading on the London Stock Exchange.