Circuit City to close all its stores
Güncelleme Tarihi:
The Associated Press
Oluşturulma Tarihi: Ocak 19, 2009 00:00
NEWYORK - Bankrupt Circuit City Stores, unable to work out a sale of the company, said Friday it will go out of business - closing its 567 U.S. stores and cutting 30,000 jobs.
The second-biggest U.S. consumer electronics retailer is the latest casualty of an unprecedented pullback in consumer spending that has driven other brands such as KB Toys, Mervyns and Linens 'N Things into bankruptcy. Experts believe there will be more to come.
"This is the only possible path for our company," Circuit City's acting Chief Executive James A. Marcum said Friday. "We are extremely disappointed by this outcome."
The company had been seeking a buyer or a deal to refinance its debt, but the hobbled credit market and consumer worries proved insurmountable. Negotiations for an acquisition went past midnight on Thursday, Circuit City lawyer Gregg Galardi said in court.
Two buyers - Mexican billionaire Ricardo Salinas Pliego, who controls a chain of electronics stores in Latin America, and the Golden Gate Capital private equity firm - had been looking to buy the firm in a shrunken form. But the company couldn't secure the necessary financing or support from vendors.
Some employees were notified Friday that they would lose their jobs and certain stores would begin close-out sales as early as Saturday.
Judge Kevin Huennekens gave final approval to the liquidation plan. "This is a sad day for management, the employees, customers and the community," the judge said.
It was unclear what would happen to the company's 765 retail stores and dealer outlets in Canada. Galardi told a judge there are still bids for the Canadian business.
The liquidation of Circuit City follows the worst holiday shopping season in four decades. People have slashed their spending since the financial meltdown in September as they worry about their job security and declining retirement funds.
Circuit City filed for bankrupcty in November.
"This is the only possible path for our company," Circuit City's acting Chief Executive James A. Marcum said Friday. "We are extremely disappointed by this outcome."
The company had been seeking a buyer or a deal to refinance its debt, but the hobbled credit market and consumer worries proved insurmountable. Negotiations for an acquisition went past midnight on Thursday, Circuit City lawyer Gregg Galardi said in court.
Two buyers - Mexican billionaire Ricardo Salinas Pliego, who controls a chain of electronics stores in Latin America, and the Golden Gate Capital private equity firm - had been looking to buy the firm in a shrunken form. But the company couldn't secure the necessary financing or support from vendors.
Some employees were notified Friday that they would lose their jobs and certain stores would begin close-out sales as early as Saturday.
Judge Kevin Huennekens gave final approval to the liquidation plan. "This is a sad day for management, the employees, customers and the community," the judge said.
It was unclear what would happen to the company's 765 retail stores and dealer outlets in Canada. Galardi told a judge there are still bids for the Canadian business.
The liquidation of Circuit City follows the worst holiday shopping season in four decades. People have slashed their spending since the financial meltdown in September as they worry about their job security and declining retirement funds.
Circuit City filed for bankrupcty in November.