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Richard Branson sells off Virgin Megastores brand

Richard Branson on Monday sold his Virgin Megastores record shops in Britain and Ireland, shedding the brand that launched his Virgin empire.

The British tycoon said high street music retailing was facing a stiff challenge from supermarket and online sales.

Virgin Group sold Virgin Megastores in Britain and Ireland for an undisclosed sum to a management buy-out team.

The deal creates Britain and Ireland's largest independent entertainment retailer and the 125 stores will now be rebranded as Zavvi after Zavvi Entertainment Group.

"I opened my first Virgin Megastore when I was 16, 30 years ago, so it's a slightly sad day to be selling them today," Branson said. "But I'm selling them to the people who ran the stores so I'm certain they'll be in good hands."

He said Virgin Group had chosen to move away from retailing into licensing music.

"There's no question that with online sales and cheap supermarket prices that music retailing has become a different business than it was 30 years ago when I started," he said.

Branson's Virgin Group includes interests as diverse as airlines, mobile phones, radio stations, trains and cola.

Branson founded Virgin as a mail order record retailer in 1970 and a year later opened the first Virgin record shop in London on Oxford Street, a main shopping thoroughfare.

In 1979, the company moved to its Oxford Street "megastore" that remains its flagship outlet.

Monday's sale represents the latest development in a sector suffering from increased competition and falling sales in the face of rising digital downloads.

"Our most recent investments have also included renewable energy and clean technologies in line with the group's desire to become one of the world leaders in that field along with sustainable transportation and travel," Branson said.

"[Entertainment retailing] is no longer viewed as core to the group's future," he said.
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