Radio Shack files for bankruptcy again; to close 200 more stores

Mar 10, 2017, 00:41
Radio Shack files for bankruptcy again; to close 200 more stores

RadioShack says that it was making efforts toward returning to profitability after coming out of its bankruptcy two years ago.

In bankruptcy documents [PDF] filed with a federal bankruptcy court in DE, the Shack's attorneys detail their plans for remaining stores.

Electronics retailer RadioShack has filed for its second bankruptcy in two years and will close 200 of its 1,500 stores. The 1743 retail outlets that survived RadioShack's 2015 bankruptcy were acquired by General Wireless Inc, an affiliate of Standard General LP, which, at the time, received US Bankruptcy Court approval to acquire the inventory and assume the leases of the RadioShack stores. Since that time it has added "stores within stores" for Sprint products.

In a statement, RadioShack President and Chief Executive Officer Dene Rogers said since the company's bankruptcy filing in 2015, the retailer had made progress in stabilizing operations, including reducing operating expenses by 23 percent.

Sprint began pulling its wireless product displays from some RadioShack stores in recent days in a sigbn that the partnership was crumbling.

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But, in the years since RadioShack has emerged from bankruptcy, both Sprint and RadioShack have been challenged.

Sprint said that it has already reached an agreement with RadioShack to convert several hundred stores into Sprint-owned stores, and that it will be able to provide jobs at other locations for any Sprint employees working at a store that closes.

"It became apparent to the debtors that not only would they not receive the originally projected cash commissions in 2016, but they likely would not receive commissions from Sprint, even at a substantially reduced amount until 2018", Rogers said.

The influx of cheaper copycat consumer products manufactured overseas has also hurt the business.