London Stock Exchange-listed music retailer HMV has taken a 50 per cent stake in venture-backed 7digital for £7.7m (€8.8m).
7digital, an online music store, was backed by Balderton Capital, a London-based venture capital firm.
Balderton most recently participated in an $8.5m funding round in 2008 that was led by Sutton Place Managers.
7digital will become HMV’s exclusive supplier of digital media content, comprising music and entertainment stores for HMV customers in the UK and Canada and ebooks from Waterstone’s.
HMV’s online customers in the UK and Canada will have access to a catalogue of over six million high-quality MP3 tracks, with content from all four major labels, and a selection of video content via 7digital branded stores. 7digital will also power an enhanced e-books store for Waterstone’s customers, building on the book retailer’s leading position in the fast growing e-book market.
The company currently provides download services for Spotify, Last.fm, and will soon launch an MP3 download application for RIM’s BlackBerry devices.
Ben Drury, CEO of 7digital, said, “HMV is the largest entertainment retailer in the UK and Canada, and combining our digital expertise with the respected brand will create a compelling download offering for the consumer. The widespread adoption of the MP3 format has raised the profile of legal downloading amongst consumers and the market is continuing to grow. We already provide a number of high profile clients with successful download services and are confident we will see similar success with this venture.”
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