Branson’s Megastores piled up £300m losses

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Accounts filed at Companies House show that Virgin Holdings, which owns a number of Branson's businesses, swung into the red in the year that ended in March 2008.

Profits of £151.7 million turned into losses of £227.3 million that year after a one-off operating loss of £324.3 million.

That came after the 125 Virgin Megastores were sold to Zavvi, a rival music retailer, which went into administration last year with debts of more than £100 million.

A Virgin spokesman said that Virgin Holdings' losses were mainly due to accumulated losses at Megastores over many years, which were written off once the business was sold.

The accounts also reveal that Virgin paid Zavvi £61 million to break a licensing agreement for the use of the Virgin brand.

The firm also wrote off another £21 million when it sold Virgin Vie, the cosmetics business, to its management. This also led to a payment — of £8.8 million — to remove the Virgin brand.