On November 3, 2008 it was revealed that Circuit City would close 155 stores and lay off 17% of its workforce by the end of the year as a result of continually struggling to remain profitable.[5]
On November 7, 2008 Circuit City laid off between 500 and 800 corporate employees from their Richmond, Virginia headquarters. The approximately 1000 remaining corporate employees would all be consolidated into one building in an effort to further reduce cost and improve profitability.[6] On November 10, 2008 Circuit City filed for bankruptcy protection under Chapter 11 of the United States Bankruptcy Code.[7]
On November 3, 2008, Circuit City announced that it was planning to close 155 stores, including withdrawing completely from the Phoenix, Kansas City and Atlanta retail markets, in a continuing attempt to rally falling stock value and halt heavy financial losses.
A week later, on November 10, 2008, it announced it would file for chapter 11 bankruptcy protection which led to a dramatic plummet and halt in trading of the retailer's stock ending it's landslide at .02 cents per share at about 10:00 am est[26].
In Bankruptcy court, Circuit City was approved to borrow $1.6 billion to finance operations while it restructures. The courts revealed that the company had assets of $3.4 billion and debt of $2.32 billion [27], including a $119 million debt to Hewlett-Packard, and a $116 million debt to Samsung Electronics [28].
No comments:
Post a Comment