Six East Valley Sam Goody and Suncoast Motion Picture Co. stores are closing as part of a massive slimdown aimed to heal the ailing music and movie chains.
Trans World Entertainment Corp. said Tuesday that it will buy the chains’ parent Musicland Holding Corp., which is struggling to recover from Chapter 11 bankruptcy.
But it won’t be soon enough to save the stores already targeted.
One of each — a Sam Goody and a Suncoast — will close in Scottsdale Fashion Square, Chandler Fashion Center and Paradise Valley Mall. Two other Arizona Sam Goodys also will face the music.
The eight Arizona stores are among 341 nationwide to get the ax, nearly half the company’s locations. Musicland said the stores will close when clearance sales are completed.
Hilco Merchant Resources, which is handling the store liquidations, said $40 million worth of merchandise will be sold at 40 percent or more below regular retail price at the doomed locations.
Sam Goody and Suncoast stores in Fiesta Mall and Superstition Springs Center — both in Mesa — have been spared, at least for now.
Trans World Entertainment, parent of FYE, Wherehouse, CD World and other regional chains, said it has entered into a purchase agreement for all Musicland’s assets including stores and online sites, pending U.S. Bankruptcy Court approval.
A Trans World Entertainment spokesman was unavailable Tuesday to say whether any additional stores will be closed, and whether the company will retain Sam Goody and Suncoast names or convert stores to Trans World brands.
“We believe that the acquisition of Musicland’s assets will allow us to leverage their store locations, strategically increase Trans World’s national footprint, and will provide further growth opportunities,” said Robert J. Higgins, chairman and CEO of Trans World Entertainment in a statement.
Musicland slipped into Chapter 11 in January after a dismal holiday season, in which the mall stores were outplayed by power center giants such as Best Buy.
In its filings, the company attributed its financial difficulties to “a diminishing music and movies marketplace, growing competition from big box retailers and the increase of music downloading.”
Musicland CEO Michael Madden issued a statement Tuesday saying the subsequent sale of the whole company is the best option for saving the remaining stores and share value. “We are committed to maximizing the value of our assets and believe that a sale to Trans World is in the best interests of our associates, creditors, suppliers and customers,” he said.