[MRRiley]

tada...

David Ritz

As reported on PMAI's website

Ritz Camera purchased at bankruptcy auction by investors led by David Ritz

The assets of Ritz Camera Centers Inc., Beltsville, Md., were purchased by RCI Acquisition LLC, according to court documents filed in the U.S. Bankruptcy Court in Wilmington, Del. The group, which includes David M. Ritz, entered a winning bid of $33.1 million for the remaining 375 stores, out-bidding liquidator Hilco Merchant Resources LLC, and Ilex Capital, a Balitmore-based private equity firm. Ritz's group may keep all the stores open, depending on the outcome of talks with landlords, according to Jay Indyke of Cooley Godward Kronish LLP in New York, as quoted in Reuters.

"It was very vigorous bidding," said Indyke. The auction lasted nearly 24 hours.

The company entered bankruptcy protection in February with about 800 stores operating as Ritz Camera, Wolf Camera, Kits Cameras, Inkley's and The Camera Shop. The company also owned 130 Boater's World stores, which were liquidated, earlier this year.

Earlier this month the company determined it was unlikely to exit bankruptcy as a going concern and decided to sell the remaining stores.

A hearing on the sale is scheduled for tomorrow.

Strange how business works sometimes ain't it? Wonder who got left holding the bill?

Mike

[stevebrot]

...Strange how business works sometimes ain't it? Wonder who got left holding the bill?

Let me guess...Nikon, Canon, and the rest of the people that Ritz (that would be David Ritz) owed money to?

Steve

[MrApollinax]

Wait... so he gets to write-off the losses in bankruptcy and then gain back all the assets at a discounted price? Wow.

[MRRiley]

It'd be sorta funny if Nikon and Canon decided to pull out of the NEW Ritz (same as the old Ritz).

[SuperAkuma]

Wait... so he gets to write-off the losses in bankruptcy and then gain back all the assets at a discounted price? Wow.

Wish I can do that with my house. Not that I am in bankruptcy, just that I owe more than what the house is worth.

[Blue]

I guess David Ritz learned that trick from Government Motors earlier this month.

[reeftool]

With much of the same crew running the show I doubt that any of the camera mfg's will sell to them unless its COD.

[Gooshin]

gotta love america

[MRRiley]

With much of the same crew running the show I doubt that any of the camera mfg's will sell to them unless its COD.

I sure wouldn't.... Cash on the barrel head Davey old boy!

[monochrome]

tada...

Strange how business works sometimes ain't it? Wonder who got left holding the bill?

Mike

Let me guess...Nikon, Canon, and the rest of the people that Ritz (that would be David Ritz) owed money to?

Steve

In addition to the lenders and trade creditors, who lost 67% of their credit and factor advances (remember, the winning bidders PAID $33MM for the bankrupt company, even if it is the same people), the former owners of Ritz Camera lost 100% of their equity - even if they are the same people.

With much of the same crew running the show I doubt that any of the camera mfg's will sell to them unless its COD.

Banks will immediately lend and lessors will immediately renegotiate leases based on the capitalization ratios and business model of the new entity.

Trade creditors will immediately issue credit (factor credit) based on the same ratios. Because there are still 375 stores and where else will they sell their cameras - Walmart?

[Blue]

. . .
Trade creditors will immediately issue credit (factor credit) based on the same ratios. Because there are still 375 stores and where else will they sell their cameras - Walmart?

Best Buy (aka Bad Buy) is chocked full of CaNikon and little else. They had Oly for a while but Oly is gone now. I wouldn't be surprised to see Wal-Fart up the ante. Costco and Sam's are already doing it.

[tomwil]

All of Ritz/Wolf camera clearance auctions on eBay has been canceled as of today. I wonder if the clearance sales at the stores are also discontinued?

[stevebrot]

...the former owners of Ritz Camera lost 100% of their equity...

True. They also lost 100% of their debt.

Actually, it sounds good to me if I were David Ritz. Debt is gone and for only $33 million, I get access to the revenue stream from 300+ stores that were actually doing Ok. And as you mentioned...there is also the prospect of fresh debt financing since the market potential of those remaining stores is pretty good.

The interesting thing is that nobody would be upset if the Stevebro/Monochrome partnership ante'd up the $33 million and bought the Ritz assets. I guess it offends our sense of equity that the people that did not pay their bills should still be running the business when they apparently were anything but broke.

Steve

[SteveM]

I guess David Ritz learned that trick from Government Motors earlier this month.

Close...but taxpayers didn't pay for this......it was too late ....Bush was the architect of the Corporate Communism policy....and now he is gone.... Archaic Deregulation has now blackmailed us at the expense of our kids..... someone made a whack at this scheme....laughing all the way to the.....OK..not the bank....not that the second wave of sub prime is coming up for renewal this fall.....

[MRRiley]

I guess it offends our sense of equity that the people that did not pay their bills should still be running the business when they apparently were anything but broke.

Steve

Hit the nail on the head here Steve. This smacks of rewarding David Ritz for his failure (and as CEO it was HIS failure in spite of any contributing factors).

Mike