Friday, January 16, 2009

Circuit City to Shut Down

Another Major Advertiser Bites the Dust

Bankrupt electronics retailer Circuit City Inc. said Friday it has asked for court approval to close its remaining 567 U.S. stores and sell all its merchandise.

The company said it has 34,000 employees.

"We are extremely disappointed by this outcome," James Marcum, acting CEO for Circuit City, said in a statement. "We were unable to reach an agreement with our creditors and lenders to structure a going-concern transaction in the limited timeframe available, and so this is the only possible path for our company." [Click for MORE]

> Magazine Ads Evaporated in 2008, Faster as Months Went On

More Advertisers Who Have Filed for Bankruptcy

The fallout from the miserable holiday season is in full swing, and experts expect even more retailers to file for bankruptcy or just liquidate in coming months as consumers keep tight control of their spending because of job worries and dwindling retirement accounts.

Among notable retailers who have filed for bankruptcy protection since May:

  • Circuit City Stores Inc., the nation's second-biggest electronics retailer, filed for Chapter 11 in November. But the chain announced Friday that it will liquidate its 567 U.S. stores after failing to reach a deal to sell the company.
  • Department store chain Gottschalks Inc. put itself up for sale and filed to reorganize in a Chapter 11 bankruptcy on Wednesday.
  • Discount clothing chain Goody's Family Clothing filed for Chapter 11 bankruptcy protection on Tuesday, the retailer's second such petition in less than a year as it struggles with mounting debt and a staggering drop-off in sales.
  • KB Toys filed for bankruptcy protection two weeks before Christmas and has been liquidating its stores. KB Toys also filed for bankruptcy protection in January 2004.
  • Parent Co., the operator of online toy seller, filed for Chapter 11 bankruptcy protection in December and said it will consider selling some or all of its operations.
  • Linens 'N Things filed for bankruptcy protection in May. It announced liquidation sales at its stores in October after failing to find a buyer that wanted to operate the company.
  • Steve & Barry's filed for Chapter 11 bankruptcy protection in July, then later abandoned plans to keep stores open and said it would liquidate.
  • Mervyns LLC filed for Chapter 11 bankruptcy protection in July and said it would hold liquidation sales at its remaining stores.
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