Retail
RadioShack Parent Files Chapter 11 With 1,500 Stores at Risk
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As expected, RadioShack parent General Wireless Operations filed for Chapter 11. The company will shutter 200 stores immediately. It does not have plans yet for another 1,300. The once proud electronics retailer has been in decline for years.
The company’s announcement:
General Wireless Operations Inc. (“RadioShack” or “the Company”), doing business as RadioShack, the neighborhood electronics convenience store, today announced that the Company filed voluntary petitions under Chapter 11 in the United States Bankruptcy Court for the District of Delaware (“the Court”).
RadioShack.com, stores and dealer locations across the country are still currently open for business and serving customers. The Company is closing approximately 200 stores and evaluating options on the remaining 1,300. The Company and its advisors are currently exploring all available strategic alternatives to maximize value for creditors, including the possibility of keeping stores open on an ongoing basis.
Dene Rogers, RadioShack’s President and Chief Executive Officer commented
“For nearly 100 years, RadioShack has proudly served local communities across the United States, offering consumers unique, high-quality products at a great value. 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.”
“Since emerging from bankruptcy two years ago as a privately owned company, our team has made progress in stabilizing operations and achieving profitability in the retail business, while our partner Sprint managed the mobility business. In 2016, we reduced operating expenses by 23%, while at the same time saw gross profit dollars increase 8%. Over the same time, we integrated FedEx pickup / drop-off into 140 RadioShack locations, delivered to customers over 700,000 Hulu login pins and sold more than a million RadioShack private brand headphones and speakers delivering high quality, value-based audio products to consumers across the country. However, for a number of reasons, most notably the surprisingly poor performance of mobility sales, especially over recent months, we have concluded that the Chapter 11 process represents the best path forward for the Company. We will continue to work with our advisors and stakeholders to preserve as many jobs as possible while maximizing value for our creditors.”
About 1,200 stores are joint locations with Sprint Corp. (NYSE: S).
RadioShack was founded in 1921, and was at one time among the largest retailers in the U.S. based on locations. As recently as 1998, the company had as many as 5,000 stores
Among the milestones in its history was the introduction of its own PC line–the TRS-80 Model I in 1977. RadioShack previously filed for Chapter 11 on February 5, 2015.
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