Revised Bank Facility and Posting of Circular

7 June 2011

HMV Group plc (the "Company")

Revised Bank Facility and Posting of Circular

Revised Bank Facility

The Company announces that it has entered into revised term and revolving credit facilities (the "Revised Bank Facility") of £220 million with its lending banks, to replace the existing bank facility of £240 million. The Revised Bank Facility comprises a £70 million term loan ("Facility A"), a £90 million term loan ("Facility B"), and a £60 million revolving credit facility ("Facility C"), and is conditional upon satisfaction of customary conditions precedent and payment of a proportion of the disposal proceeds to pay down the existing bank facility. The final maturity date of each of the facilities is 30 September 2013.

Interest will be payable at a margin of four per cent. over applicable LIBOR. An exit fee will also accrue on the amount outstanding under Facility B which will be payable upon repayment of Facility B. The rate at which the exit fee accrues will start at an amount equal to 5 per cent. per annum and will ratchet upwards on 1 April 2012 to 8 per cent. per annum and again on 1 January 2013 to 14 per cent. per annum if Facility B has not been repaid by such date. In addition, no dividends are payable by the company whilst the Facility B is outstanding.

Warrants will be issued by the Company to the lending banks at closing of the Revised Bank Facility. The warrants will represent 5 per cent. of the Company's total issued share capital (on the basis that all outstanding warrants or options had been exercised), and shall be convertible into ordinary shares in the Company by a lending bank at any time after 30 June 2012.

The Revised Bank Facility contains customary covenants in relation to fixed charge cover and net debt to EBITDA. Further details in relation to the Revised Bank Facility are contained in the circular being posted to shareholders today (see below).

Posting of Circular and Timetable

Further to the announcement made on 20 May 2011, the Company announces that the circular relating to the proposed £53 million disposal of the Waterstone's business is expected to be posted to shareholders today. The circular contains a notice of a general meeting (the "General Meeting") of the Company to consider and, if thought fit, to pass a resolution approving the disposal of Waterstone's to A&NN Capital Management Fund Limited (a company controlled by a trust in which Alexander Mamut has an interest).

Closing is conditional on the passing of the resolution by the Company's shareholders. All other conditions have now been satisfied.

The General Meeting is expected to be held at the offices of Nomura International plc, Nomura House, 1 St Martin's-Le-Grand, London EC1A 4NT on 23 June 2011 at 9a.m. The expected date of closing is 28 June 2011.

Copies of the circular, including the Notice of the General Meeting, will be available from the Company's website at www.hmvgroup.com and from the UK National Storage Mechanism at www.hemscott.com/nsm.do.

Update on Current Trading and Group Strategy

The Group last updated on current trading for the 17 weeks to 30 April 2011 in its announcement dated 20 May 2011. Current trends in trading remain in line with the trading results reported at that time.

The circular to shareholders provides an update on the strategy of the Group following the disposal of Waterstone's which includes continuing to evolve the Group's product mix and growing in Live and Digital. In particular, this strategy will focus on rebalancing the store space and range through the expansion of HMV's technology offering and exploiting growth opportunities for the Group's Live venues, festivals and ticketing businesses. A more detailed update to the market will be provided in due course.

Board Change

The Company announces that Robert Swannell will step down from his role as a Non-Executive Director with effect from close of business on 23 June 2011.

Commenting, Simon Fox, Chief Executive, said:

"We are very pleased to have concluded the new bank facility, which represents another important milestone in securing the financial stability of the Group."

Enquiries:

HMV Group plc +44 20 7404 5959*

Simon Fox, Group Chief Executive

David Wolffe, Group Finance Director

Paul Barker, Director of Corporate Communications

Nomura International plc + 44 20 7521 2000

(Financial Adviser in relation to the Disposal)

Aidan Clegg

Ed Matthews

Brunswick +44 20 7404 5959

Mike Smith

Nick Cosgrove

* All calls via Brunswick

Nomura International plc, which is authorised and regulated by the Financial Services Authority in the United Kingdom, is acting for HMV Group plc and no one else in relation to the Disposal and will not be responsible to anyone other than HMV Group plc for providing the protections afforded to clients of Nomura International plc nor for providing advice in relation to the Disposal or any other matter referred to herein.