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Tweeter Accepts $38M ‘Going Concern’ Bid
After filing for Chapter 11 reorganization, the specialty retailer and bidder Schultze are seeking court approval for the transaction today.
Tweeter, the specialty consumer electronics retailer that recently filed for Chapter 11 reorganization, has accepted its highest "going concern" bid of $38 million in cash and "the assumption of significant liabilities" by Schultze Asset Management, LLC, an alternative investments firm specializing in distressed and special situations investing.
This morning, Tweeter is seeking court approval for the proposed transaction at the U.S. Bankruptcy Court in Wilmington, Del. If approved, the transaction may close today.
In a statement, Tweeter says it will continue normal operations pending a ruling.
Both Tweeter and Schultze are very excited about this pending acquisition and are committed to emerging from this restructuring process as a stronger, more competitive organization focused on delivering an outstanding service experience to our customers," says Joe McGuire, Tweeter president and CEO. "The conclusion of this auction represents a very positive outcome for our employees, customers, and business partners. We look forward to completing the sale transaction."
If the bid goes through, Schultze would also assume $8 million of Tweeter's "cure costs" associated with its bankruptcy proceeding and give it a $10 million junior debtor-in-possession line of credit. Tweeter, in another press release, says it intends to use the $10 million in new funding to purchase merchandise and for other general corporate purposes.
Schultze's bid includes the purchase of Tweeter's 18.75 percent interest in Tivoli Audio, LLC. Separately, Whippoorwill Associates, Inc. and Bay Harbour Management, L.C. have teamed up to make a $10 million bid for just Tweeter's Tivoli ownership interest, according to Tweeter.
This morning, Tweeter is seeking court approval for the proposed transaction at the U.S. Bankruptcy Court in Wilmington, Del. If approved, the transaction may close today.
In a statement, Tweeter says it will continue normal operations pending a ruling.
Both Tweeter and Schultze are very excited about this pending acquisition and are committed to emerging from this restructuring process as a stronger, more competitive organization focused on delivering an outstanding service experience to our customers," says Joe McGuire, Tweeter president and CEO. "The conclusion of this auction represents a very positive outcome for our employees, customers, and business partners. We look forward to completing the sale transaction."
If the bid goes through, Schultze would also assume $8 million of Tweeter's "cure costs" associated with its bankruptcy proceeding and give it a $10 million junior debtor-in-possession line of credit. Tweeter, in another press release, says it intends to use the $10 million in new funding to purchase merchandise and for other general corporate purposes.
Schultze's bid includes the purchase of Tweeter's 18.75 percent interest in Tivoli Audio, LLC. Separately, Whippoorwill Associates, Inc. and Bay Harbour Management, L.C. have teamed up to make a $10 million bid for just Tweeter's Tivoli ownership interest, according to Tweeter.
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About the Author
Tom LeBlanc, Senior Writer/Technology Editor, CE Pro
Tom has been covering consumer electronics for six years. Before that, he wrote for the sports department of the Boston Herald. Migrating to magazines, he was a staff editor for a golf publication and an outdoor sports publication. Now, as senior writer/technology editor of CE Pro magazine since 2003, he dabbles in all departments and offers expertise in marketing. Follow him on Twitter @leblanctom.
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