Ten days ago, word got out that Circuit City could be on its way to bankruptcy. The Washington Post said the U.S. electronics store chain had lost a recommendation from a "firm that advises manufacturers on whether to ship goods to retailers," signaling it might have trouble paying vendors. The firm also faced a number of blows in recent months, including the departure of its CEO, Blockbuster's withdrawal from a takeover bid, and $239-million losses for its last fiscal quarter.
Today, the Wall Street Journal reports that Circuit City is considering a plan that would involve shutting "at least" 150 stores and cutting jobs. Circuit City sees the move as a potential alternative to filing for Chapter 11, the WSJ adds. Circuit City has also enlisted the services of a corporate law firm and a consulting firm to come up with a turnaround strategy. The law firm—Skadden, Arps, Slate, Meagher & Flom LLP—reportedly walked Kmart through its 2002 brush with bankruptcy.
According to the WSJ, Circuit City is scrambling to prevent a bankruptcy filing before the holiday season in order to avoid damaging consumer confidence: "Customers might doubt the ability of a retailer involved in bankruptcy proceedings to provide warranties on products like laptop computers and flat-screen TVs."
|PSU deathmatch: Cooler Master V750 vs. Rosewill Capstone-750-M||6|
|64-bit Chrome goes beta, promises better speed, security, stability||9|
|Eizo's FlexScan EV3237 has 31.5'' of 4K goodness||16|
|Logitech gaming mouse combines optical and motion sensors||42|
|Silent Power PC is cooled by copper foam||36|
|ARM-based Opteron now available in $2,999 developer kit||17|
|Best Buy CEO: Tablets 'crashing,' PC seeing 'revival'||113|
|Core i5 powers bizarro Android convertible||21|