RUMOR MILL
Tuesday, April 18, 2000
TOWER LOOKING FOR CASH INFUSION
Retailer Decides Against Stock Flotation, Seeks To Sell Stake In Company
Tower Records is seeking to sell a stake in the company to raise cash to expand its stores in the U.S., Britain and Japan, Britain's Sunday Telegraph reported.
The music retailer, which owns around 200 stores worldwide, also needs cash to enlarge its Internet business.
The newspaper said the private placement, with Merrill Lynch advising on the deal, could value the retailer at up to $100 million.
The paper said Tower Records chief exec Russell Solomon decided against a stock market flotation as investor sentiment had "turned away" from music retailers. Tower posted more than $1 billion in sales in 1999, but the newspaper said company profits were hit last year by a foreign currency transaction loss.
The music retailer, which owns around 200 stores worldwide, also needs cash to enlarge its Internet business.
The newspaper said the private placement, with Merrill Lynch advising on the deal, could value the retailer at up to $100 million.
The paper said Tower Records chief exec Russell Solomon decided against a stock market flotation as investor sentiment had "turned away" from music retailers. Tower posted more than $1 billion in sales in 1999, but the newspaper said company profits were hit last year by a foreign currency transaction loss.
