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Ares Management LLC, which owns the majority of Guitar Center Holdings Inc.’s debt, is in advanced discussions with Guitar Center owner Bain Capital to take over the company, the Wall Street Journal reported yesterday. The two investment firms are in the final stages of hashing out a deal to convert the Guitar Center debt that Ares owns to equity, a process they are trying to complete outside of bankruptcy court while also keeping valuable tax breaks. Under the terms being discussed, Bain would keep a minority stake in the company, but the exact size wasn't clear. Guitar Center has about $1.6 billion in debt, much of it stemming from Bain's $2.1 billion leveraged buyout of the company in 2007. But the 253-store U.S. chain faces competition from e-commerce, and debt payments are eating into its cash flow.

RadioShack Corp. said today that it expects to close up to 1,100 U.S. stores, or about 20 percent of its footprint, while also reporting its fourth-quarter loss widened significantly, the Wall Street Journal reported today. The Wall Street Journal had reported a month ago that the company was seen closing about 500 stores in the coming months as it worked with advisers to restructure the company. The chain will continue to have about 4,000 U.S. stores, including dealer franchise locations. Chief Executive Joseph Magnacca said that the poor results in the fourth quarter were driven by lower store traffic, intense discounting particularly in consumer electronics and a "very soft" mobility marketplace, as well as a few operational issues.

Sandwich chain Quiznos is preparing to file for bankruptcy-court protection within weeks as it contends with unhappy franchisees and a $570 million debt load, the Wall Street Journal reported today. Quiznos has been negotiating with creditors for weeks on a restructuring plan that would streamline its trip through bankruptcy court, but a deal hasn't yet been reached. The chain's move toward bankruptcy comes two years into a major turnaround effort that included an out-of-court debt restructuring and a management shake-up. While a chapter 11 filing would give the company much-needed flexibility on leases and unattractive contracts, the company must repair its damaged relationship with franchise owners who say they're being squeezed out of business by the high cost of operating a Quiznos outlet.

A Gordon Brothers Group division has offered to purchase women's clothing retailer Dots at a bankruptcy auction next week, saying that it is prepared to begin shutting down roughly 360 stores on March 1, Dow Jones Daily Bankruptcy Review reported today. At a court hearing held on Friday, Bankruptcy Judge Donald Steckroth characterized the bid from Gordon Brothers as a "liquidating bid" and denied the bidder's request for special fees as a reward for stepping out with a lead offer.

Women's clothing retailer Dots is preparing to sell its roughly 370 stores at a Feb. 26 auction, the Wall Street Journal reported today. According to court papers, the struggling chain got permission from bankruptcy Judge Donald H. Steckroth to set a Feb. 25 bid deadline for potential buyers. Dots officials haven't named a lead bidder for the auction. The Ohio-based chain, which employs more than 3,500 people, filed for chapter 11 protection on Jan. 20 after losing shoppers when the quality of the chain's merchandise declined under prior management. In earlier court papers, former Chief Executive Lisa Rhodes said that the company has new leaders and fresh merchandise that will enable the company to "thrive as a profitable player in the retail market."

Dots LLC Chief Executive Lisa Rhodes has left the women's clothing retailer, prompting the chain's lawyers to ask a bankruptcy judge for permission to terminate her $750,000-a-year employment contract, the Wall Street Journal reported on Saturday. In court papers, Dots lawyers announced that Rhodes departed the company Feb. 7 after 18 months as its top leader. Her departure came as company officials are searching for a buyer to purchase the chain's roughly 400 stores out of bankruptcy. Rhodes joined the company during a revitalizing effort to win back customers who left when the quality of the chain's merchandise declined under prior management, according to court papers. Dots lawyers last week asked Bankruptcy Judge Donald H. Steckroth for permission to end her employment agreement.

Two retailers in Southern California have reached a $55 million deal to buy Phoenix-based Pro's Ranch Markets, which filed for Chapter 11 bankruptcy protection last May, the Associated Press reported yesterday. The family-owned chain of grocery stores popular with Latino customers was founded 31 years ago and has seven stores in Arizona and two each in New Mexico and Texas. Cardenas Northgate Group Ranch announced yesterday that as part of the deal, it will also get Pro's Ranch Markets' corporate office and a 151,000-square-foot warehouse in Phoenix. CNG Ranch officials say all 11 Pro's Ranch Market stores will remain open for the foreseeable future. Cardenas Markets currently owns 26 stores in California and three in Nevada while Northgate Gonzalez Markets operates 38 California locations.

With a bankruptcy auction already in the works, Dots LLC has "several" potential buyers interested in running the women's clothing retailer as a continuing business, according to Kenneth Rosen, a lawyer for the ailing chain, the Wall Street Journal reported today. "Several of the potential suitors are looking at Dots as a going concern — which is what the company wants to see," Mr. Rosen, of Lowenstein Sandler LLP, said yesterday. Court papers say that there is no committed opening bid yet, and hence no guarantee that Dots won't fall into the hands of liquidators at a planned Feb. 28 auction. However, interest among bidders in keeping Dots alive means hope for the 400-store chain of discount-clothing outlets and its 3,500 employees. Dots filed for chapter 11 protection Jan. 20 and signed up $36 million worth of financing from existing lender Salus Capital Partners LLC.

Two families that own major Hispanic-oriented grocery store chains throughout the Southwest got approval from a federal judge Tuesday to purchase the struggling Pro's Ranch Market chain's 11 stores out of bankruptcy, Dow Jones Daily Bankruptcy Review reported today. After reviewing the purchase offer at a court hearing, Bankruptcy Judge Sarah Sharer Curley said that she would approve it, according to Pro's Ranch Market attorney Frederick Petersen. The buyers' offer is worth about $53.6 million, according to court documents.

Less than three weeks into the going-out-of-business sales, five Loehmann’s locations have already closed completely, the Wall Street Journal reported today, and six more will lock up for the last time this Sunday. Loehmann’s also announced on its website that Monday, Jan. 20, was the last day it would honor store credits. Gift cards will be honored until Feb. 7. Loehmann’s Holdings Inc., the owner of the Loehmann’s retail stores, filed for chapter 11 protection in late December. Through the process, the company sold its merchandise to a group of liquidators, which is conducting the going-out-of-business sales. That sale was approved by the bankruptcy court on Jan. 7, and the going-out-of-business sales began on Jan. 9.