Environment

Exponential growth in the music download market has prompted print and packaging group St Ives to sell its loss-making Dutch media packaging division to its management for EUR2.8m (£2.1m).

The division, St Ives Uden, had been under scrutiny since earlier in the year due to what the company described as "subdued" demand for the company's products, which include CD inlays and cases, record sleeves and disc duplication.

Matt Armitage, St Ives finance director, said that the download market was affecting the whole music industry. "It's no secret that the music industry is struggling, and the singles market almost doesn't exist any more.

"The business has been under review for some time and we felt that it was now best taken forward by its management."

The Dutch business served the north European market and Armitage said that UK customers would not be affected by the sale.

In the UK, St Ives has effectively hedged its exposure to the music market by rolling its two media packaging plants – in Crayford and Blackburn – into its Direct Response and Commercial division. Armitage said that most of the work covered by the two plants was B1 litho printing.

The division reported a loss of €900,000 in St Ives' last published full-year accounts, to 3 August 2007, and the book value of the firm's assets in February this year was €5.6m.