FORT WORTH, Texas, Feb. 5 (UPI) -- Half of RadioShack's 4,000 stores will close under a reorganization plan announced Thursday as the company filed for Chapter 11 bankruptcy.
The survivors will be operated by Standard General LP, a hedge fund and the largest holder of RadioShack stock, and the telecommunications giant Sprint Corp. The agreement calls for Standard General to take over 1,750 to 2,500 stores.
The company, headquartered in Fort Worth, Texas, filed its petition in U.S. Bankruptcy Court in Delaware, listing assets of $1.2 billion and debts of $1.39 billion. RadioShack has posted losses of $1 billion in the past three years, and sales have continued to slide.
The New York Stock Exchange suspended trading in RadioShack stock Monday. Bloomberg News, citing sources, reported Tuesday that Amazon was in negotiations to acquire some RadioShack locations to allow the e-commerce company to compete with Apple's physical presence.
RadioShack began in Boston in 1921 as a single store catering to ham radio operators and ships' radio officers who could visit the store or buy through mail order. For decades, it profited from the spread of electronic equipment, introducing one of the first personal computers, the TRS-80, in the 1980s and becoming a major retailer of cellular phones.
But the Internet helped bring the company down as its customers started buying equipment and parts online. It was also squeezed by big box competitors like Best Buy and Walmart.
Bruce Clark, an employee in Langhorne, Pa., told The Wall Street Journal the Christmas season was a bust. He said the workers were packing the remaining inventory for shipment to other stores while the Langhorne outlet is slated for the chopping block.
"We're not getting a lot of foot traffic," he said.
