Entertainment retailing company HMV Digital China Group has decided to close its HMV Retail business in Hong Kong due to the impact of online streaming media on its physical store business.
The company has taken this decision after consideration of its insolvency and the various defaults in payments related to lawsuits received by HMV Retail.
Recently, HMV Retail Hong Kong has also reported a 41% decline in revenues, compared to the same period last year.
In addition, the company has appointed Wong Sun Keung and Tsui Mei Yuk Janice from Vision as the joint and several provisional liquidators of its retail business.
In a statement, HMV Digital China Group said: “the board believes that it is in the best interests of the Company and its shareholders as a whole to agree to the voluntary winding-up.
“The company may be able to reduce its investment losses as well as to allocate more resources and management efforts to develop its existing business.”
“During the period of liquidation, the liquidator will continually seek new investors to re-commence business operation of HMV Retail.”
HMV is currently in negotiation talks with the landlords for further settlement plans.
The decision follows the company’s announcement to close 102 stores of its retail business in Canada last year.
In 2013, HMV Retail experienced financial difficulties at its UK head office, which resulted in the company filing for bankruptcy as well as closing all its branches globally.
In another statement, HMV Digital China Group board said: “The Company will focus on the network streaming media and entertainment business in Greater China in the future.
“The Company keeps identifying potential opportunities on expanding retail business in other regions, in particular, China.”