ReturnBuy Finds Buyer, Files Chapter 11
By Alan Wolf -- TWICE, 2/10/2003
ASHBURN, Va. — ReturnBuy, the three-year-old online seller of returned and excess consumer electronics inventory, filed for Chapter 11 protection last month, while seeking court approval for a buyout.
The company owes more than $9 million to creditors including Circuit City, UPS and Google, but has received the bankruptcy court's OK for debtor-in-possession financing to continue operations.
The white knight, Jabil Circuit, is a $3.6 billion St. Petersburg, Fla.-based concern that provides design, manufacturing, repair and warranty services worldwide for electronics companies including Cisco Systems and Hewlett-Packard.
ReturnBuy senior VP/marketing Steve Kirchner described the proposed acquisition as "a good fit," with Jabil providing financing and new client services that will allow the e-tailer to grow faster and extend its reach overseas. Jabil, which has already met with a number of ReturnBuy's approximately 20 retail and vendor clients, has signed a letter of intent to purchase all assets and is currently conducting due diligence, Kirchner said. Pending court approval, the buyout could be concluded by the first week of March.
Kirchner said the purchase would be transparent for consumers, as ReturnBuy's name and Web site will remain unchanged. Likewise, no significant changes in business model or strategy are anticipated, although some "tactical changes" are planned. Plans for the company's management team and corporate structure have not been finalized.
Launched in 1999, ReturnBuy inspects, refurbishes and sells open box and overstock electronics from retailers and manufacturers over its own Web site, www.returnbuy.com, and through eBay, which is a business partner and minority investor. The company is headquartered here and maintains a 250,000-square-foot processing facility in West Columbia, S.C.
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