Live Entertainment Inc., a Van Nuys videocassette distributor, has agreed to sell its long-ailing retail division to a group of the unit's managers.
The purchase price is $38 million, plus the assumption of the retail division's debt.
The buying group includes Ivan R. Lipton, the division's president, other senior managers, Jefferson Capital Group Ltd. and Daniels & Associates. The sale is expected to be completed in August, subject to certain conditions.
Proceeds from the sale would be used to buy back some of Live's Series B preferred stock, which is mandatorily redeemable upon the sale of the retail business. The redemption price of the Series B preferred was $50.4 million as of June 30, and increases by $600,000 each month to a maximum of $60 million.
Live said it has had discussions with lenders who might provide the funds needed to buy back the remaining Series B preferred stock. The repurchase of all the stock is a condition of Live's previously announced agreement to merge with Carolco Pictures Inc., a Los Angeles movie producer.