Woodland Hills, Calif. - Ritz Camera Centers is putting itself on the auction block.
The cash-strapped camera chain, which filed for Chapter 11 bankruptcy protection in February, is looking to sell all or part of the business as a going concern, or short of that, liquidate all or part of its assets in an open auction.
Ritz closed half of its 800 camera stores and shut its 130-unit Boater's World chain of water sports stores in a recently concluded going-out-of-business sale that began in March.
Despite the action, which lowered its expenses and cost structure and "significantly increased its liquidity," the company is unable to fund operations through the summer or purchase inventory for the fall holiday season, it said in a bankruptcy court filing.
Ritz has held "very productive discussions" with two potential bidders, either one of which may buy a portion of the remaining camera stores as a going concern. The company hopes to solicit an initial bid from one of the two parties - a so-called "stalking horse" purchaser - and then conduct an auction in which its assets that would be sold to the highest bidder.
Ritz will accept bids for all of its assets, including inventory, leases and intellectual property, it said.
A hearing on the bidding procedures will be held July 10 at the U.S. Bankruptcy in Wilmington, Del., and a sale hearing has been scheduled for July 23.
Ritz, the nation's largest specialty camera and imaging products chain, filed for Chapter 11 bankruptcy protection in February amid declines in its camera and boating businesses and demands by lenders to boost its reserves.
The privately held business began operations in 1918 from a single store in Atlantic City, N.J. Following its acquisition of Wolf Camera in 2001, the chain had over 800 stores in more than 40 states across the country.
The company raised more than $40 million from its Boater's World fire sales, and was expected to sell some $50 million in close-out imaging inventory, which included digital cameras and accessories, d-SLR compact cameras, digital frames, binoculars, camcorders and video accessories.
The sales were conducted by the same joint venture that liquidated Circuit City's stores, comprised of Great American Group, SB Capital Group, Tiger Capital Group and Hudson Capital Partners.