Sunrise Records has completed its acquisition of Trans World Entertainment assets, including the FYE chain, which gives the Canadian-based chain that also owns HMV about 400 outlets in North America and the U.K.
While the agreement calls for Sunrise to pay Trans World $10 million for the assets, it also applies a formula that could see the final price at about $11.5 million. That's based on Jan. 20 inventory levels at the retail chain worth $44 million, according to the filing. Trans World will continue to run online merchandiser eTailz, which it bought for $36.7 million in cash and 5.7 million in shares in October 2016.
As part of the deal, the Trans World assets Sunrise acquired include all accounts or notes receivable; all inventory, all property leases, all cash equivalents and other monies derived from the operation. In addition to acquiring the assets of Trans World, Sunrise also assumed certain liabilities such as up to $2 million in gift cards and customer loyalty discount cards, and employment compensation obligations; and -- most importantly to labels and distributors -- all inventory-related accounts payables and related liabilities.