Tweeter Gets Two Bids For Assets
By TWICE Staff -- TWICE, 6/27/2007
Canton, Mass. — Tweeter reported it has received two bids for its assets in connection with the company’s Chapter 11 reorganization efforts.
Schultze Asset Management has made a $38 million “going concern” bid for substantially all of the company’s assets. Schultze would also assume $8 million of Tweeter’s “cure costs” associated with the company’s bankruptcy proceeding, as well as provide the national specialty consumer electronics retailer with a $10 million junior debtor-in-possession line of credit. Tweeter 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.
Separately, Whippoorwill Associates and Bay Harbour Management have teamed up to make a $10 million bid for just Tweeter’s Tivoli ownership interest.
The U.S. Bankruptcy Court today approved Schultze’s, Whippoorwill’s and Bay Harbour’s respective bids under a process where other qualified bidders will have the opportunity to submit “higher or otherwise better” offers. An auction will commence on July 10 among Schultze, Whippoorwill, Bay Harbour and any other qualified bidder.
“We are pleased to complete these important steps in our restructuring process as we move forward,” said Tweeter president/CEO Joe McGuire. “Our objective is to bring cash into the company as quickly and responsibly as possible, and today’s events move us closer to that goal.”
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It is no surprise any of this has happened. They have been nothing but a problem since they bought and destroyed the United Audio Image in Chicago and keeping employees seems to be a very big challenge for them. Having them gone opens up the market for more sales to the independants and makes us stop cleaning up all the jobs they have started and destroyed. I look forward to them being closed...
Joe Bu - 2007-27-6 10:53:00 EDT -
Not surprising that the bidding has begun. In my view, it makes more sense to sell the entire company as a going concern than to piecemeal the assets. $38MM is a 10% premium over total net worth at 3/31/07. It's a lower premium now since the stock was delisted. If Schulzte wins the bid, I'd expect them to sell off the Tivoli Audio piece and dismantle the rest of the company. Then, Tweeter will have truly blown.
Bill Penn - 2007-27-6 10:32:00 EDT
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