Circuit City Filing for Bankruptcy Protection

Electronics retailer Circuit City and its Canadian counterpart The Source by Circuit City are filing for Chapter 11 bankruptcy protection. The retailer, headquartered in Richmond, VA, announced the voluntary petition on November 10, calling it a “reorganization” in a release to investors. The company hopes to continue operations unabated, but spokesman Job Babb said it is “safe to assume” that there will be some agressively discounted prices on products being liquidated. Circuit City announced last week that they are closing 155 stores across the US, so today’s announcement does not necesarily come as a surprise. The company also recently cut 700 corporate positions – coupled with the store closures, it amounts to a 20 per cent reduction in work force.

In October, AT&T and Circuit City announced a partnership to bring AT&T’s U-Verse TV to consumers. U-Verse delivers home tv over AT&T’s IP network via FTTP or FTTN technology and is hoping to become a major cable competitor. It is unclear how Circuit City’s announcement will affect that retail deal.