FORT WORTH, Texas -- When RadioShack was on the ropes last year, CSP asked, "Can the Shack come back?" Following its Chapter 11 bankruptcy filing in February in 2015, the electronics retailer is preparing for that "comeback" by taking a page from the convenience-store industry.
In a deal approved on March 31, General Wireless Inc., an affiliate of Standard General LP--RadioShack's largest shareholder--has received U.S. Bankruptcy Court approval to acquire the inventory and assume leases of 1,743 RadioShack stores following an auction.
"This has admittedly been a difficult time for all RadioShack supporters. That having been said, this transaction is an important milestone in this storied company's history," said Soo Kim, managing partner of Standard General, the majority shareholder of General Wireless. "It has allowed the company to shed stifling debts and unprofitable business lines. The new company has now been reorganized around a solid retail franchise underpinned by a world-class mobility carrier, Sprint Corp. It will now have the resources to fulfill its core mission of providing more than 1,200 communities across the country with first-rate service and high-quality, high-value electronics and accessories."
RadioShack is embarking on its second lease on life as a shadow of its former self, an afterthought in a world dominated by Amazon and Best Buy that has little need for scrappy stores that peddle cables and connectors, said a report in The New York Times.
But Standard General doesn't see it that way.
With this deal, RadioShack will slim down to become an "electronics convenience store" of sorts, said the report, focusing on gear such as Bluetooth headsets, chargers and other accessories that shoppers may need immediately rather than waiting a day or two for a delivery from an e-commerce website.
Tablets, laptops and digital cameras will disappear from RadioShack stores, the report said.
One of the most profitable RadioShack stores is a Bridgehampton, New York, outlet that is frequented by weekend vacationers who have forgotten their smartphone chargers or earphones and duck in for a replacement. And one of RadioShack’s top-selling products is hearing aid batteries.
Ron Garriques, a former Dell and Motorola executive tapped last week to lead the new RadioShack, said the chain would also focus on small cities with populations of 5,000 to 100,000, where demand still exists for a neighborhood electronics store.
Standard General is now looking for more partners to set up displays or shops-inside-shops at RadioShack, the report said. Those partners could sell anything, Garriques said: consumer electronics, home security systems, solar panels, wireless chargers.
But don't expect the new RadioShack to start selling milk, bread, coffee or gasoline … yet.
Click here to read the full New York Times report.
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