Standard General to Buy up to 2,400 RadioShack Stores

Feb 6 2015 | 1:54am ET

Fading retailer RadioShack has finally completed its long slow march to bankruptcy. In a deal struck before the retailer's Chapter 11 filing, hedge fund Standard General will purchase up to 2,400 of the firm’s remaining stores.

The announced deal could allow the RadioShack brand to survive. Standard General's affiliate General Wireless and Sprint Corporation will establish a dedicated mobility "store within a store" retail presence in up to 1,750 of the acquired locations.

Under the agreement, Sprint would operate in one-third of the retail space in each RadioShack location and sell mobile devices and plans on all Sprint brands including Boost and Virgin Mobile.

“This agreement would allow Sprint to grow branded distribution quickly and cost-effectively in prime locations,” said Sprint CEO Marcelo Claure in a statement. 

Sprint and Standard General will serve as stalking-horse bidders in the process, and both must compete  in a court-supervised auction against other potential buyers.

RadioShack has roughly 4,000 company-owned stores in the United States and said it is discussing the sale of its remaining assets with interested parties. Said RadioShack's CEO Joe Magnacca: "These steps are the culmination of a thorough process intended to drive maximum value for our stakeholders."

The more than 1,000 international dealer franchise locations, stores operating under its Mexican subsidiary, and RadioShack's Asia operations were not included in the Chapter 11 filing or pending agreements.  

RadioShack had not turned a profit since 2011.

In its bankruptcy filing, RadioShack said it had roughly $1.2 billion in assets and $1.4 billion in debts, as of Nov. 1. The company's largest unsecured creditor is Wilmington Trust, to which it owes roughly $330 million.

The firm will continue to operate normally through the bankruptcy process.


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