K-tel on Wednesday blamed the division's demise on the tough
operating environment and a legal dispute with a major customer
over payments due.
It said the subsidiary, K-tel International (USA) Inc., sought
protection Monday under Chapter 7 of the federal bankrupcty laws in
K-tel USA distributed licensed music mainly to retail record
stores but has struggled through cost and staff reductions for
about a year.
The parent company and outside consultants "concluded that
K-tel USA was no longer viable," K-tel International said in a
K-tel International Inc. and its other subsidiaries including
Dominion Entertainment Inc., K-tel Entertainment (UK) Ltd., and
K-tel DVD, Inc. continue their operations.
K-tel said it will focus on its operations in England which
the company said recently turned profitable and licensing its