Tower Records files Chapter 11

The Sacramento-based music chain, which has a big presence in L.A., has sought bankruptcy protection and wants to sell its assets through a court-appointed auction - preferably by mid-October. That would provide enough time to prepare for the holiday shopping season. The question is who might want a chain that despite its storied name and history, has had a tough time competing with big box retailers like Wal-Mart - as well as online services. Phil Leigh, a senior analyst for Inside Digital Media Inc., told Dow Jones Newswires that the Tower brand has value and will find a buyer, but its stores aren't likely to survive this latest bankruptcy. "I think they'll sell off the name and liquidate the inventory," Leigh said. But the company said it's actively negotiating with one potential buyer and received another offer on the eve of its bankruptcy filing - Tower's second in less than three years. L.A.-based Houlihan Lokey Howard & Zukin is evaluating potential bids for the company.