#IS RADIO SHACK GOING OUT OF BUSINESS FULL#

That frustrated the store's core customers, electronics enthusiasts, and weakened the brand. RadioShack's stores essentially become cell phone kiosks, but signing up customers took about 45 minutes per person, tying up store employees, Bloomberg notes. While that initially drew consumers into the stores, it also led to some serious problems for the company. While it once again defied my expectations by getting a lifeline at seemingly the last minute, unless it uses this opportunity to truly transform its business this could indeed be the last of the holidays RadioShack will ever see.When RadioShack stopped making computers in 1993, it turned to an emerging technology to ride to profits: Cell phones.

#IS RADIO SHACK GOING OUT OF BUSINESS FULL#

It a curious selection because Magnacca ought to be focusing his full attention on saving his own company without having to worry about what's going on elsewhere.ДЄs much as I shop at RadioShack for components for various electronic projects I work on, I've been predicting for some time the retailer will see its last Christmas.

It recently revived hopes that apparel retailer American Apparel (NYSEMKT: APP) could survive the near-collapse that began with the ousting of its CEO.ДЄfter getting almost the entire board of American Apparel to resign, Standard General selected RadioShack's Magnacca as one of the new directors to clean up the place. This isn't the first troubled retailer Standard General is stepping in to save. Investors are getting the chance to purchase stock at a big discount to its current price, but any stock that remains outstanding at the end of the offer Standard General will buy up. The rights offering, though, represents a substantial dilution of existing shareholders, who would see their stake in the company reduced to as little as 20% of the total if no one was to participate in the program, while anyone that does acquire equity in the transaction could have no more than 35% of the total voting power. Photo: Flickr user Vernon Chan.ДЄs it works to transition away from reliance on mobile devices, which have been an anchor on its performance, RadioShack ran into a roadblock to its ambitious consolidation plans in the form of lenders who worried that closing so many stores would inhibit their ability to get repaid, regardless of how necessary it might be for the long-term survival of the company. RadioShack dialed up the wrong number by betting big on mobile. It also holds out the hope that the company will achieve its plan to close as many as 1,100 stores. Giving the retailer greater liquidity for the holidays ought to allay any fears among vendors that RadioShack won't be able to pay them. RadioShack said it intends to move forward with the rights offering later this year or in early 2015. If the $120 million in debt financing is converted to equity, the hedge fund gets to name four directors to RadioShack's board, in addition to which CEO Joseph Magnacc and two independent directors the company can select will also serve. While some analysts had believed RadioShack would seek out bankruptcy protection as a means of achieving a turnaround, Standard General apparently felt there was some worth still to be found in its operations and has set the stage for a recapitalization that is expected to be completed by 2015.ДЇollowing a second-quarter loss of $137.4 million that saw comparable-store sales plunge 20% from the year-ago period, RadioShack said it was 'actively exploring options for overhauling our balance sheet and are in advanced discussions with a number of parties.' That proved to be Standard General, which said late last month it was trying to improve the retailer's liquidity. Hedge fund Standard General, the electronic gadgets retailer's top shareholder, stepped in to save it from all but certain death by agreeing to lead the refinancing of a $535 credit facility with General Electric ( GE -2.89% ) and to provide $120 million to bolster the company's liquidity.

Showing remarkable resilience, the electronics retailers has once again staved off disaster. How much longer it has to live, though, is anyone's guess. RadioShack ( RSHCQ )В will survive another Christmas.

Is radio shack going out of business