Valley Media is liquidating assets just 2 months after seeking ba...
Valley Media is liquidating assets just 2 months after seeking bankruptcy protection following collapse of proposed merger with Alliance Entertainment. Woodland Hills, Cal., distributor is taking bids on $90 million in inventory and $100 million in receivables and hearing…
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has been scheduled in U.S. Bankruptcy Court, Wilmington, Del. for Jan. 30, Pres. Lew Garrett said. Any assets not sold by Feb. 8 will be auctioned off on Web. Music distributor Alliance has moved quickly to snag some assets, paying $325,000 for Valley’s Audiophile database and Schwann publications and $200,000 for DVD Advance catalog, Garrett said. Money raised through auction will be used to pay secured creditor Congress Financial. Valley has received “hundreds” of bids for assets from customers, creditors. movie studios and content owners, Garrett said. Valley valued its debt at $259.2 million at time of bankruptcy filing. Competitors haven’t waited long to attack. Navarre late last week hired staff from company’s former distributors of N. America Div. with goal of landing new label distribution deals, Navarre CEO Eric Paulsen said. Valley got its start as music distributor, but made ill-fated attempt to broaden into video with $36 million acquisition of Star Video in late 1990s. It later added distribution for online retailers such as Cyberian Outpost. “The die was cast several years ago because Valley overspent for Star Video and never fully integrated it,” Garrett said. Valley also “overbuilt” in adding 2nd warehouse in Louisville and suffered from large amount of uncollected receivables, he said.