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RadioShack Files For Chapter 11 Bankruptcy

The New York Stock Exchange plans to delist the shares of troubled Fort Worth-based retailer RadioShack.

Update, 6:20 p.m.: ​RadioShack, the Fort Worth-based electronics retailer with a storied past, filed for Chapter 11 bankruptcy Thursday. It will sell as many as 2,400 of its 4,000 stores.

Most of those stores will now carry the Sprint banner outside -- and a combination of Sprint and Radio Shack products inside.

RadioShack's largest shareholder, Standard General, is buying those shops and worked out the deal with Sprint.

The chain will close its unprofitable stores -- a list of those will be announced soon.

In Thursday's filing, RadioShack listed assets worth $1.2 billion; in November, the chain had $1.4 billion in liabilities.

Original Post, Feb. 2: The New York Stock Exchange plans to delist the shares of troubled Fort Worth-based retailer RadioShack.

RadioShack Corp. has been struggling with weak sales that have rendered it unprofitable. The company warned last year that it may have to seek Chapter 11 bankruptcy and its CEO recently warned it might not be able to find a long-term plan to stay afloat.

This has hammered its stock price and the NYSE requires companies meet certain market capitalization thresholds to remain on the exchange. According to a press release Monday, the NYSE plans to delist RadioShack and suspend its shares because the company does not intend to submit a plan to address the issue.

RadioShack declined to comment.

Shares fell 13 percent to close at 24 cents on the NYSE.

News of the delisting comes as Bloomberg reportsthat RadioShack is considering selling half its stores to Sprint:

“RadioShack Corp. is preparing to shut down the almost-century-old retail chain in a bankruptcy deal that would sell about half its store leases to Sprint Corp. and close the rest, according to people with knowledge of the discussions," Bloomberg reports. "The locations sold to Sprint would operate under the wireless carrier’s name, meaning RadioShack would cease to exist as a stand-alone retailer, said the people, who declined to be identified because the talks aren’t public.”

Bloomberg warns that the negotiations could break down or things could change, including another bidder coming in to buy RadioShack. 

KERA's Bill Zeeble offers this update:

Radio Shack, the long-ailing Fort Worth-based retailer, may be nearing its end amid reports that a bankruptcy deal could shutter the chain. Rumors are swirling that Sprint could take over half the chain’s stores, or that Amazon might get involved. Here’s an analyst in Boston who’s followed Radio Shack’s decline for years.


Radio Shack hasn’t turned a quarterly profit in nearly three years. Analyst Scott Tilghman, with B. Riley and Company, says the business has been out of touch with the times for a while. Gone are the days when consumers could fix their radio or computer with parts from the store, or get your free battery through the battery club.

“Many more devices are rechargeable rather than requiring discrete batteries,” Tilghman explains. “A lot of the small parts are widely available albeit in a kiosk in the mall or something you can order online. You know it’s very easy to go on Amazon to get what you might need, assuming you don’t need it for a day or two.”

In the 80s and 90s, Radio Shack focused on cell phones. So many retailers have them today, from Staples and Best Buy to Walmart and every grocery store, Tilghman says Radio Shack can’t stand out.

“The biggest challenge for Radio Shack has been two-fold. One has been a shift in business mix,” Tilghman says, “losing out in the hobbiest business, the specialty parts business, and second has been extreme competitiveness in the wireless or mobile phone category.”

Tilghman says Radio Shack’s been struggling to get people back into stores. Over the last few years, the chain has even created a few test stores that show off current technology the way people want to use it.

“So many more devices talk to one another today and are compatible with one another,” Tilghman says, “and share information. That wasn’t the case four or five years ago.  Because of that shift in connectivity, be it your phone to tablet to tv to your computer, there’s a need to display those.” 19

Only problem, says Tilghman, Radio Shack lacks the money to create more of those kind of stores, or the funding to publicize and market them. Still, despite the Sprint and Amazon reports, he doesn’t see Radio Shack completely disappearing.

“I think we’ll probably in some form or fashion have a handful of stores, you know, few hundred stores in high traffic areas where they are able to maintain profitability,” Tilghman says.  

In any event he suspects thousands of those strip center locations will end up closing down.