Circuit City, the struggling electronics retailer that filed for bankruptcy protection in November, said Friday it is pulling the plug on its entire chain and plans to liquidate inventory.
The company operates a 40,000-square-foot superstore at Columbus Park Crossing. It opened in August 2002 with about 90 employees and is one of several anchor stores for the shopping center located at the intersection of Veterans Parkway and J.R. Allen Parkway.
“We are extremely disappointed by this outcome,” James A. Marcum, vice chairman and acting president and chief executive officer for Circuit City Stores Inc., said in a statement Friday morning.
“The company had been in continuous negotiations regarding a going-concern transaction,” Marcum said. “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.”
No timeline was given by Circuit City for the liquidation of inventory and assets. It already has received approval from a U.S. Bankruptcy Court judge to proceed with a going-out-of-business sale if it could not find a buyer.
The company said it “does not anticipate any value will remain from the bankruptcy estate for the holders of the company’s common equity.”
Circuit City has a 22-year-plus history in Columbus.
First store here in ’86
The retailer of television sets, stereos and computer systems first opened at Columbus Square Mall in 1986, operating an 8,000-square-foot store for more than six years. The Macon Road mall eventually closed and was torn down several years ago.
But before the mall’s death, Circuit City led an exodus from the center, announcing in April 1992 plans to construct a 21,000-square-foot store on Airport Thruway near the current Hobby Lobby arts and crafts store.
Circuit City remained at that location until August 2002 when the chain upgraded once again, venturing to the newly opened Columbus Park Crossing shopping development off Whittlesey Boulevard.
But that was before the retailer hit hard times. The company, which has been posting financial losses for some time, announced in early November that it was closing 155 of its 700 stores nationwide and laying off up to 7,300 workers.
A bleak holiday shopping season, combined with tightening credit and reduced flow of inventory from vendors, was the nail in the chain’s coffin.
The Columbus store and the outlet in nearby Opelika, Ala., were not on the November closure list, but two stores in Alabama and 19 in Georgia were on it. Most of the Georgia stores targeted for closure last fall were in the Atlanta area, although the Macon, Warner Robins and Newnan locations were also on the hit list.
Many similar scenarios
At the end of December, Circuit City operated 567 stores in 153 U.S. markets. It also has 765 stores and dealer outlets in Canada. It also operates a Web site, www.circuitcity.com, and a technology service called “firedog.”
The pace of store closings appears to be picking up pace nationally as the U.S. recession progresses. Locally, casual-clothing retailer Goody’s and off-price retailer Steve & Barry’s are going out of business as part of chainwide liquidations.
Circuit City, an electronics staple for decades in the United States, is among the largest retailers to fall in several years. Analysts say its demise could have a ripple effect on other shopping center and mall operators around the nation.
“It will bring to market a glut of big box spaces across the country,” said John Bemis, head of Jones Lang LaSale Inc.’s leasing team.
The Associated Press contributed to this report.