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Circuit City pulls the plug after 60 years
Unable to sell off assets and work out a deal with creditors, Circuit City Stores Inc. last month said it would liquidate its assets and go out of business. As of mid-January, it had closed CircuitCity.com and Firedog.com, but said the termination of U.S. operations would not affect the Canadian online and offline retail businesses Circuit City operates as a division of Canada-based InterTan Canada Ltd.
After a last-ditch effort failed to sell off certain assets and work out a deal with its creditors, Circuit City Stores Inc. said last month it would liquidate all of its assets and go out of business. The move will result in the closing of 567 stores and the laying off of about 34,000 employees.
No. 16 in the 2008 edition of the Internet Retailer Top 500 Guide, with $1.4 billion in 2007 online sales, Circuit City as of mid-January had shut down its e-commerce site, CircuitCity.com, and its customer services site, Firedog.com. It noted, however, that its e-commerce site could re-emerge in some form.
The retailer, founded in 1949 as the Wards Co. and based in Richmond, Va., filed for bankruptcy in November with hopes of a turnaround with a new strategic financial partner, but the economic downturn left it with few options, the company says.
“Regrettably for the more than 30,000 employees of Circuit City and our loyal customers, 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,” vice chairman and acting president and CEO James Marcum said in a statement.
The warranties Circuit City provides on goods sold through the liquidation process will continue to be honored by third-party warranty companies, though any Circuit City gift cards still in circulation will have no value after liquidation proceedings are completed, the company says.
The termination of its U.S. operations will not affect the 765 The Source stores and their sister e-commerce site, TheSource.ca, that Circuit City operates in Canada as a division of interTan Canada Ltd., Circuit City says.