NEW YORK (Bloomberg) — US retailers will face a Darwinian fight for survival next year as they run out of cash as early as January and competition forces thousands of store closings, according to private-equity buyers and restructuring experts.

Probably 50,000 stores could close without any effect on consumer choice, Gregory Segall, a managing partner at buyout firm Versa Capital Management Inc., said yesterday during a panel discussion held at Bloomberg LP's New York offices.

"The United States is massively over-stored in all categories," Segall said. He said his firm is in "a wait mode" and he expects banks to squeeze retailers after January 1.

Plunging home prices, rising unemployment and tightening credit have led consumers to rein in spending, resulting in what may be the worst holiday season in at least four decades. Macy's Inc., Kohl's Corp. and other retailers have marked down items 50 percent to lure customers, eroding margins at a time when store owners hope to make a third or more of their annual profit.

Only retailers with healthy balance sheets will survive the recession, said Matthew Katz, a managing director at consulting firm AlixPartners LLP.

"This is a very Darwinian time," Katz said.

At least a dozen US retailers have entered bankruptcy this year, according to data compiled by Bloomberg. Circuit City Stores Inc. and Boscov's Inc. have said they will reorganise and leave court protection as smaller chains, while Linens 'n' Things Inc., Sharper Image Corp., and Value City Department Stores LLC all plan to liquidate.