Tower Records RIP
Tower Records Closes; Liquidation Process Begins
Tower Records will soon be liquidated, a jarring and symbolic development for the music industry. Just recently, a bankruptcy court approved a pending purchase by Great American Group, which now intends to liquidate Tower assets. Great American triumphed in a crowded bidding process, one that also included massive music retailer Trans World Entertainment. The winning bid was $134.3 million, though the all-in purchase price is closer to $150 million, according to a Tower attorney. Approximately 3,000 Tower employees will now be out of work.
Most within the industry expected a late-stage save by Trans World, though the retailer was outbid by just $500,000. Now, the fallout is already beginning, though it remains unclear if every store will be shuttered. Music fans will undoubtedly mourn the loss, especially those that grew up with the chain. Those same fans will probably jump at deep discounts on remaining CDs, part of a shutdown period that could spark holiday unit sales. For labels, the development is difficult to stomach, and offers a stark reminder of a shifting business. Sales of physical CDs have already dipped eight percent this year in the United States, part of a multi-year slide.
(Via Digital Music news)