Circuit City Announces Liquidation
After filing for bankruptcy protection in November, Circuit City was hopeful that it would be able to reorganize and reemerge. Now, only a day after the company held an auction that was suppose to be the retailer’s last chance to survive bankruptcy as an intact, though smaller chain, the company announced it has hired four liquidators to sell all remaining merchandise in 567 stores before going out of business for good.
"We are extremely disappointed by this outcome," James Marcum, acting CEO for Circuit City, said in a statement. "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."
U.S. Bankruptcy Judge Kevin Huennekens had given the company permission to liquidate if a buyout was not achieved. However, the company still needs final approval of liquidation from the court. With court approval, the liquidation sale is to begin Saturday and run until March 31. The retailer's Web site and call center will cease to operate after Jan. 18.
Update: A federal bankruptcy judge approved Circuit City’s liquidation request, so the going-out-of-business sales will start tomorrow.