Ritz Camera CEO David Ritz, along with a group of investors won the assets of his company at a bankruptcy auction. If approved by the court, they will retain ownership of the company and its 375 stores for just $33.1 million. And, they get to leave the company's $54 million debt behind though.
Ritz filed for Chapter 11 bankruptcy protection in February, but earlier this month it gave up on hatching a viable turnaround plan. Instead, it turned to liquidation. The chain was apparently a hot property. Bidding was reportedly fierce and went 43 rounds. Had Ritz not won, odds are good the stores would have been closed and sold for parts since liquidation firms were among the bidders.
How then can David Ritz have the money to buy up the assets if, as CEO, there wasn't enough to execute a business plan? Well, an asset sale means they get the assets without the debt, while exiting Chapter 11 requires that debt to be restructured. And Ritz has partners, including Ritz Interactive, which is the retailer's separate online business and not part of the bankruptcy filing.
Presumably, he's also using his very own money. Ritz is the son of the company's founder and the 91-year-old business is surely dear to his heart. Ritz is still the nation's leading specialty chain, and from the many comments Walletpoppers left on the post announcing Ritz's imminent demise, there's still a place for a dedicated photo specialists in this big box, mass market country.
Court approval is slated for the afternoon of June 23.
Ritz camera saved ... by a Ritz, of course