HMV has sold Waterstones’s book chain to Russian billionaire Alexander Mamut for £53m.

Mamut, who already holds a 6.7% stake in HMV has been a frontrunner for the buyout since HMV put the 314 Waterstones store chain on sale last month.

The sale to Mamut’s A&NN Capital Fund Management is expected to be finalised by the end of June.

HMV Group has looked increasingly embattled of late and issued its third profit warning in April earlier this year. The retailer’s sales have seriously fallen in the facef of fierce competition from supermarkets and web retailers such as Amazon and iTunes.

The company said on Friday that the Waterstones sale represents an “important step towards strengthening the capital structure of the remaining HMV Group”.

“We expect this deal to enable the Group to achieve a reduction in the group’s borrowing requirements, and, in turn, focus on plans for transforming the HMV Group into a broad-based entertainment business,” said Simon Fox, the chief executive of HMV Group.

Mr Mamut said he was “extremely pleased to have reached an agreement to acquire Waterstone’s and its great heritage”.”I believe our investment and strategy will secure a dynamic future for the UK’s largest bookshop chain.”

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