V Shop to disappear after Sanity deal.

Virgin Entertainment Group is to re-unify its entire UK High Street operations under the Megastores brand, after selling off 41 stores to Australian retailer Sanity.

It has agreed a seven-figure deal with Sanity to hand over part of its loss-making V Shop business and is now putting in place a rapid conversion programme to have the remaining 60-odd stores in the chain rebranded as Megastore Xpress stores by mid-November.

Virgin Retail managing director Andy Randall believes the move to a single Megastores brand will simplify its message to customers. It gives the retailer 167 Megastore or Megastore Xpress stores across the UK and Ireland, compared with 155 for the specialist retail market leader HMV, which expects its store numbers to rise to more than 160 by the end of the year.

"As far as I'm concerned, this is about us repositioning all of Virgin's High Street stores as Megastores and Megastore Xpress stores," adds Randall. "It gives us one brand and makes us extremely focused now as a group."

The decision to sell off 41 V Shop stores comes just over a year after Virgin struck a first deal with Sanity for the Australian independent to take over 77 stores which were then being run as Our Price outlets. It also finally brings to an end a lengthy period of uncertainty for the one-time Our Price chain, dating back to 1998 when Virgin acquired the 75% of Virgin/Our Price it did not own from WH ...