Tower Records is a name most music fans/buyers are familiar with. Most of us have probably bought a CD or two from Tower Records in the past. I know I’ve even seen some great “in store” performances by bluegrass artists that I love at a Tower Records store. That may be a thing of the past. Yesterday Tower Records entered Chapter 11 Bankruptcy protection. The move will allow the company to sell its assets in a process that will be guided by the courts while protecting it from its creditors, including some of the major record labels. Company officials at Tower Records stated
This process, which is subject to court approval, sets in motion a timeline of events that will ultimately insure a sale of the company within approximately 60 days of the filing date.
The company hopes that a buyer will step forward quickly enough to allow the new owners to restructure in time to take advantage of the holiday buying season. In an effort to continue operational and inventory expenses as it completes the sale, the company has entered into an $85 million debtor-in-possession financing arrangement with a bank group led by CIT.
Failure to complete a sale in the allotted time frame could result in an asset liquidation, including the brand name, thus ending Tower Records as we know it.