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Shack formed out of the ashes of the Pale Fountains, cult favorites led by Liverpudlian brothers Michael and John Head. Chris McCaffrey, the Fountains' bassist and Michael's best friend, died from a brain tumor in 1986 and Michael began experimenting with drugs, including heroin, which was especially prevalent in his neighborhood. Despite his drug problems, Michael formed a new group with John, the L-Shaped Room. The brothers later changed the band's name to Shack and released the debut album Zilch in 1988, with friend and roommate Ian Broudie as their producer. Though the album's sales were poor, Shack persevered, recording a new album, Waterpistol, in 1989. However, a fire destroyed the studio and all of the group's tapes, save one copy that the producer had kept; this copy was lost on a road trip in America. The tape was found a year later by the car rental agency the producer had used, and the album was released soon after by a German label. Waterpistol received strong reviews and provided Michael Head the opportunity to record a solo album, The Magical World of the Strands (by Michael Head & the Strands), in France. However, Head's heroin addiction continued and his creative output slowed until the late '90s, when Shack began work on their third album, H.M.S. Fable. Though it was delayed several times by Head's stays in detox, the album was released in the U.K. in the spring of 1999 to critical raves, and a U.S. release followed in the fall. The follow-up album Here's Tom with the Weather arrived in 2003, and the Head brothers along with drummer Iain Templeton and bassist Pete Wilkinson appeared on Shack's 2006 album, On the Corner of Miles and Gil, released by Noel Gallagher's Sour Mash label.