Systemax Bids $6.5M To Buy Circuit Brand
By Alan Wolf -- TWICE, 4/20/2009
RICHMOND, VA. — Circuit City may live on as a subsidiary of Systemax under a proposed $6.5 million sale of its trademarks and Internet assets.
The former CE chain has agreed to sell its brand name, related trademarks and domain names to the Long Island, N.Y.-based computer manufacturer and marketer pending a May 11 auction.
The sale also includes Web site content, customer data, toll-free phone numbers and certain online patents and applications, court documents show.
In addition to the $6.5 million purchase price, Systemax would also pay Circuit City a certain percentage of any resulting sales for a period of 2.5 years. The percentage would vary depending on the amount of revenue generated under the Circuit City brand, the documents indicated.
Systemax similarly acquired the brand, trademarks and e-commerce business of CompUSA in January 2008. That deal, which fetched about $30 million, also included some 16 former CompUSA storefronts. Systemax also sells its products through its TigerDirect stores, catalog and Web site.
The agreement has been submitted for approval to the Bankruptcy Court for the Eastern District of Virginia, here. Besides the court’s O.K., the deal is also subject to the outcome of the auction process.
In the April 9 filing, Circuit City Stores said, “In the course of their continued liquidation, the sellers have identified various assets — including the intellectual property and Internet assets — that are valuable but for which the sellers have no use going forward. The sellers have thus determined that the sale of the intellectual property and internet assets would bring significant recovery for the sellers’ estates and creditors.”
Systemax said the transaction, if completed, “would further extend its position as a leader in online retailing of value-priced, branded consumer electronics.”
The deadline for competing offers is May 6, and the winning bid will be determined at a hearing here on May 13.
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