Circuit City finds itself a target
Circuit City has executed 316 turnaround plans (slight exaggeration) in the last several years. And some investors think the electronics retailer is due for another one.
Wattles Capital Management, D.E. Shaw, and HBK Investments have increased their ownership in Circuit City and are campaigning for serious change.
What change exactly?…
“I haven’t talked to a single shareholder who didn’t agree there needs to be a change in management,” says Mark J. Wattles, the investment firm’s president. (source: The Wall Street Journal)
The list of shareholders to which Mr. Wattles refers and his plans for the retailer remain as visible as Circuit City’s profits for the upcoming fourth quarter. That is to say, not very. Perhaps Wattles’ hiring of proxy solicitation firm MacKenzie Partners will shed light soon.
Mr. Wattles, to his credit, has purchased 32 Ultimate Electronic stores out of bankruptcy, recently achieving 3% same store sales growth (albeit in a 4% inflationary U.S. economy).
And D.E. Shaw, remember, is the same outfit that fought recently to install new management at Take-Two Enterprises, and is currently fighting a very profitable acquisition offer for Take-Two from Electronic Arts in a bid to squash shareholder value.
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