RadioShack files for second bankruptcy in two years
11 March 2017
Electronics retailer RadioShack has filed for its second bankruptcy in two years. The company will
shut 187 more stores this month, about 9 per cent of its 1,943 locations.
Following its 2015 bankruptcy filing, the Fort Worth, Texas-based company, the company closed around 2,400 stores. It was later acquired by General Wireless, a joint venture of hedge fund Standard General and Sprint, which operated 1,518 stores.
In a Chapter 11 reorganisation petition filed Wednesday in the US Bankruptcy Court in Delaware, General Wireless stated it planned to close 187 stores this month, for which the process had already started. The chain added that it was also closing the RadioShack portion of the 360 stores that it shared with Sprint, and was evaluating whether to do the same in 971 other shared stores.
The moves would affect about 1,850 of RadioShack's 5,900 employees.
''Over the course of the past two years, our talented, dedicated team has worked relentlessly in an effort to revitalize the Company and the RadioShack brand, while providing outstanding service to our customers. We greatly appreciate their hard work and dedication," said RadioShack CEO and president Dene Rogers in a statement.
Meanwhile, Sprint would convert several hundred locations into Sprint corporate-owned stores, the wireless provider said in a separate statement.
RadioShack's bankruptcy filing and subsequent store closings were not material to Sprint's overall sales results, Sprint added.
RadioShack first filed for bankruptcy in 2015, after it was caught off-guard as customers moved to big box competitors including Best Buy Co Inc and Amazon.com Inc.
The company's partnership with Sprint was aimed at keeping its 1,740 stores open as it invited the mobile carrier to co-brand with it and set up smaller stores within its own, according to commentators.
They added, Sprint, at the time, viewed RadioShack's retail footprint as a way to rapidly grown its own business while RadioShack hoped to benefit from increased liquidity in the form of rent and commission payments from Sprint.