Court OKs Tower Records Web sale
EmptyWASHINGTON -- A bankruptcy judge approved the Tower Records sale of its Web site business to an affiliate of Miami-based music seller Caiman Inc. for about $4.2 million.
Judge Brendan Shannon of the U.S. Bankruptcy Court in Wilmington, Del., on Tuesday signed off on the deal with Caiman Holdings Inc., a British Virgin Islands holding company affiliated with Caiman. The chief executive of Caiman, Didier Pilon, also serves as a director of Caiman Holdings, according to court papers.
Caiman, which sells music, books and DVDs on its own site, is also a major reseller on Amazon.com. As part of the deal, Caiman agreed to assume some of Tower Records' existing liabilities.
This is the second sales agreement of Tower Records' site business since the retailer filed for bankruptcy. Norton LLC, an affiliate of Bill Sagan's Wolfgang's Vault site, agreed to buy Tower's Web business in October for about $3.8 million but couldn't close the deal.
Tower Records, with stores in 20 states, filed for Chapter 11 protection on Aug. 20, after trying for six months to sell itself as a whole. The retailer emerged from a prior bankruptcy in 2004 under the ownership of its bondholders and a trust created by founder Russell Solomon.
Liquidators took over most Tower Records stores in October after paying $134 million and beating out the chain's former rival Trans World Entertainment Corp. after a 30-hour auction.
The Sacramento, Calif., company blamed the rapid decline in its business on a shift in music buyers' purchasing preferences to online music sellers and away from bricks-and-mortar outlets.