UPDATE: RadioShack has filed for Chapter 11 bankruptcy, according to The Associated Press. The electronics retailer will sell up to 2,400 of its stores. As part of the bankruptcy filing, Sprint will purchase approximately 1,750 stores. The deal is part of RadioShack’s sale of a portion of its assets and assignment of specific leases to General Wireless, which is a subsidiary of Standard General LP, RadioShack’s largest shareholder.
When the transaction is approved by bankruptcy court, Sprint and General Wireless will establish co-branded stores thate will exclusively sell mobile devices from the Sprint brand portfolio and select RadioShack products, services and accessories. In essence, Sprint will operate a store within a RadioShack store, operating approximately one third of each location’s space.
“We’ve proven that our products and new offers drive traffic to stores, and this agreement would allow Sprint to grow branded distribution quickly and cost-effectively in prime locations,” said Marcelo Claure, CEO of Sprint. “Sprint and RadioShack expect to benefit from operational efficiencies and by cross-marketing to each other’s customers.”
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Below is Retail TouchPoints’ initial coverage, which was published early the week of Feb. 2.
Amazon and Sprint may acquire some of RadioShack’s 4,000 stores, according to Reuters. The news comes as RadioShack moves closer to filing for bankruptcy.
Earlier reports from Bloomberg indicated that Amazon is aiming to bolster its brick-and-mortar presence and use the locations to showcase hardware products. This move would help the online giant bring its Kindles and Fire phones closer to consumers, creating a touch-and-feel experience designed to compete with Apple, its strongest competitor in the space. There are rumors the stores also will be used for logistical purposes.
At the same time, Sprint is in talks to purchase between 1,300 and 2,000 of the remaining locations. As part of the negotiations, Sprint discussed potentially co-branding some of the RadioShack stores. The news comes shortly after Sprint CEO Marcelo Claure told investors that the company planned to open more locations in the near future.
“This is a year in which we intend to grow our distribution dramatically,” Claure said. “You are going to see the opening of more and more Sprint stores as this is one area that we work on.”
