Ultimate Electronics shareholders hire Chanin as financial advisor

By Ellen Chang

Houston, Feb. 24 - An ad hoc committee of non-insider equity shareholders of Ultimate Electronics, Inc. has hired Chanin Capital Partners LLC as its financial advisor.

The committee currently consists of Atticus Capital, LLC, Contrarian Capital Management, LLC, Aegis Financial Corp. and individual investor Greg Meyer.

In addition, the committee said several other shareholders have expressed interest in joining and have submitted letters to the case trustee supporting the formation of an official committee because they believe their interests are unlikely to be protected by the company or the official committee of unsecured creditors.

The committee recently requested that the U.S. Trustee appoint an official committee of non-insider equity holders.

Equity holders said they believe that a significant amount of equity value exists. Some of the key valuation issues include the following: the purchase of $4.4 million of company stock by new chairman and chief executive officer Mark Wattles one day before the bankruptcy filing, the company's current market capitalization of $28.4 million and the company's potential for significant operating improvements.

Chanin will provide a valuation to the U.S. Trustee detailing why it believes there is equity value in the estate.

The ad hoc committee had previously retained Dechert LLP and The Bayard Firm as its legal counsel.

Ultimate is a Thornton, Colo.-based consumer electronics retailer. Its Chapter 11 case number is 05-10104.

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