Wilmington, Del. — Hearings in RadioShack’s bankruptcy auction were expected to enter their second week at the federal court here this morning.
Top creditor Salus Capital Partners said it will continue to argue for its losing bid after indicating on Friday that it would enter a new, higher offer, the Wall Street Journal reported.
The winning package, an arrangement between lead lender Standard General and Sprint, would make a go of RadioShack’s remaining 1,743 stores, although most of the deal’s $180 million valuation is built around debt forgiveness, leaving creditors out in the cold.
In contrast, Salus, a top RadioShack creditor, offered $271 million in cash for the retailer in concert with three liquidators. The bid, which would likely lead to the chain’s closure, was rejected by RadioShack for being based on projected proceeds from a proposed lawsuit against Standard General.
Federal bankruptcy court Judge Brendan Shannon is presiding over the case.
In other news, Mexican retailer Grupo Gigante has agreed to acquire RadioShack’s $115 million south-of-the-border business, consisting of 251 stores plus brands and trademarks. The company had operated RadioShack’s Mexican stores as part of a 16-year joint venture that ended in 2008, and plans to remodel the showrooms and add more locations.
Grupo Gigante similarly ran and later acquired Office Depot’s Mexican stores following a joint venture with the No. 2 U.S. office-supply chain.