HITS Daily Double
"Tower was probably the greatest brand that will ever exist in music retail."
—-Jim Urie, UMGD President


Famed Retailer Will Fade Into History After Liquidation Firm Acquires it for $134.3 Million
The chain that began in the back of a Sacramento drugstore owned by Russ Solomon’s father in 1960 and grew to be the leading record retailer in the world is shutting down.

Tower Records will be liquidated beginning tomorrow after Great American, the lead-bidder in a 30-hour auction, bid $134.3 million for the property.

The liquidator put together a consortium of other suitors who were bidding on different components of the retailer. Earlier in the day, it had appeared that maybe Trans World would acquire the famed retail chain, but that report was erroneous.

UMGD President Jim Urie told Billboard: “It's a sad day for the music business and I feel badly for all Tower employees. Tower was probably the greatest brand that will ever exist in music retail.”

The company owed some $200 million to its creditors, which includes the four major music distributors.

In court. Michael Bloom, a partner with Philadelphia law firm Morgan, Lewis & Bockius LLP, which represents the creditors committee, questioned if the winning bid was actually the best. Trans World's partners, Hilco Merchant Resources, LLC., upped its bid by $500,000 after the auction closed, matching Great American's bid, making it more attractive to Tower’s 2700 employees and its trade creditors.

But U.S. Bankruptcy Court Judge Brendan L. Shannon ruled in favor of the Great American bid, noting it was important to vindicate the Chapter 11 auction process.

Tower Records could live on via Tower.com. Norton LLC, part of the Great American consortium, put up $3.8 million to acquire Tower.com and the now-defunct Pulse Magazine.

Out-of-business sales at Tower's stores will begin tomorrow.

Solomon opened the company's landmark store on Hollywood's Sunset Boulevard in 1969. As part of the bankruptcy auction, the Sunset property will be sold for $12 million.