A SOLOMONIC DECISION
AT THE TOWER

With the sale of Tower Records a foregone conclusion, President/CEO Michael Solomon has announced his plan to leave the company in order to provide the new ownership with a "clean leadership slate," according to a letter written to the company’s staff.

The highly respected son of founder Russ Solomon had "officially" been with the company since 1987, serving then as legal counsel, although he was outside counsel for the preceding12 years as well. Solomon took over as President/CEO in ’98.

In the letter, he stated that his father would be staying on "in his current patriarchal role." Michael tells us that he will return to practicing law with a focus on real estate. He calls his biggest accomplishment working with Tower their worldwide expansion.

"Not that I did it by myself, but I helped turn Tower into an internationally known and renowned company, " he states.

Did it break his heart to have to ultimately sell off those international assets? "Little by little. The last two years have been extremely challenging. We basically had a number of things go wrong internationally. Hong Kong, Argentina, Taiwan, to an extent, with the U.K. faltering primarily because of increased rents and flat sales."

According to Solomon, domestic operations were fine and Japan was thriving, but both ended up absorbing and offsetting the losses from the other international territories. Hence, the ultimate sale of the Japan operations to Nikko Principal Investments last year.

Still, Solomon is very bullish about Tower. "I think it has a great future. It’s going to be awesome. Unfortunately, the last two years have been too much for me. But I believe whoever ends up controlling and operating that company is for a good ride."

Rumors as to who is currently still in the bidding war for the legendary chain vary. Insiders insist, contrary to other reports, Musicland owner Sun Capital did indeed participate in the re-bidding process that occurred last week. Is Trans World still in? What about Nikko? And now talk of Clear Channel being in the mix has also surfaced.

Will something be announced before the end of the year? Some believe that it could be any day now, while other insiders disagree that it will be that soon.