Musicland Updates

posted on 2006-01-16 10:51 EST
Suncoast Returns Manga, Navarre Funimation Owed $12.8 Million By Musicland

Navarre Corporation, the parent company of Funimation and numerous other entertainment companies, has issued a statement saying that it is owed $12.8 million by Musicland for November and December invoices, which will not be paid due to Musicland's recent chapter 11 filing (payment will be deferred until after Musicland exits bankruptcy protection).

Navarre CEO Eric Paulson said, "We believe that any market share lost by Musicland through this reorganization will be absorbed by other customers and that the net effect on our business going forward should not be significant."

On Friday Musicland announced that it plans to 284 of its 867 retail outlets as part of its reorganization. Suncoast stores slated for closure are already hosting special inventory clearance sales.

Meanwhile Suncoast has begun returning all manga to its manga supplier, Ingram Books, and will stop selling manga for the foreseeable future. Although Musicland bought anime directly from many companies, all manga was purchased through Ingram. Ingram is responsible to publishers for payment for all unreturned product. Like other suppliers, Ingram will not see payment from Musicland until after the bankruptcy protection period, however Ingram remains responsible for paying publishers.

ICv2 reports that Mediaplay inventory has been sold to liquidators and that anime companues are "concerned" that the product will make its way back to them in form of returns from other customers or that it will be sold at retail for reduced prices.

This article has a follow-up: Musicland owes anime companies $8.7 million (2006-01-23 11:30)
follow-up of Musicland Group Files for Chapter 11
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