Musicland requests three-month exclusivity extension to file revised liquidation plan

By Caroline Salls

Pittsburgh, July 11 - Musicland Holding Corp. requested an extension to its exclusive period to solicit votes on a plan of liquidation, according to a Monday filing with the U.S. Bankruptcy Court for the Southern District of New York.

The company wants to extend its exclusive solicitation period to Oct. 9 from July 11.

According to the motion, although the plan was filed within the statutory deadline, because of a changing of hands of the company's secured trade debt, negotiations over the terms of a revised consensual plan were stalled.

Musicland said negotiations have resumed in recent weeks and substantial progress has been made.

Therefore, the company says the extension is needed to give it time to revise the plan to reflect the negotiated terms, to get court approval of a disclosure statement and to conduct solicitation of the amended plan.

Musicland, a Minnetonka, Minn., specialty retailer of pre-recorded entertainment software products, filed for bankruptcy on Jan. 12, 2006. Its Chapter 11 case number is 06-10064.

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