Systemax Buys Circuit City Name, Domains
Source: Tom's Guide US | Keywords: Systemax, Buys, Circuit, City, Properties | Themes: Business
Systemax has set itself up to be a major brick-and-mortar retail player with the purchase of intellectual property owned by Circuit City.
Systemax, the New York-based company behind TigerDirect, CompUSA and Systemax Computers, has just added Circuit City to its stable of subsidiaries.
According to a bankruptcy court filing related to the demise of Circuit City, Systemax has agreed to purchase all intellectual property and Internet-based assets owned by the now defunct retail chain. Systemax and CC agreed to deal to the tune of USD $6.5 million. The agreement also gives Systemax certain "protection" regarding other components of Circuit City during a sell off auction scheduled for May 13th. Properties in the agreement include Internet content and domain name, customer data, phone numbers and several patents.
In addition to the $6.5 million Circuit City will receive, Systemax has also agreed to give CC's holding company a specific percentage of all revenue generated under the Circuit City name. If Systemax uses its new property like it does the CompUSA name, Circuit City Stores would stand to receive a substantial amount of cash from Systemax. According to Circuit City, "The sale of the intellectual property and Internet assets would bring significant recovery for the sellers’ estates and creditors.”
In November of last year, Circuit City announced that it was in dire straits financially. After several months of attempting to raise funds and negotiate with debtors, the chain was forced into bankruptcy. According to Chron, the closure saw over 560 stores shut down as well as 34,000 employees without a job.
Last year also saw Systemax buy the remains of CompUSA, another chain who crumbled under the weight of its own debt. The $30 million deal is very similar to the Circuit City purchase, but Systemax received over a dozen retail locations along with IP and Web content. Systemax has now taken the once-fallen CompUSA and transformed it into a popular retail website. Also, as Tom's reported several days ago, Systemax has opened a total of 24 new CompUSA brick-and-mortar locations. These new locations are following a a new "Retail 2.0" philosophy, which includes prices that can compete with online retailers, redesigned, better-lit stores and unfettered Internet access at every computer within the new retail locations.
If Systemax takes its new retail practices and applies them to the Circuit City name, we could yet see another retail chain reborn. With both CompUSA and Circuit City under its belt, along with the popular TigerDirect website, Systemax has positioned itself for direct competition with the likes of Best Buy. The next 12-18 months should be very interesting for the retail sector.
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Why sell so cheap. Circuit city's name(even thoe extinct) is worth more than that I think. But what I really don't understand is why systemax, having already compusa would add its main competitor to its stable.
CompUSA for computers and related items, Circuit City for general appliances and electronics (camera's, tvs, etc...). It just makes sense that way.
I can't explain why Best Buy is so successful, but in general selling washing machines and computers isn't a smart business practice, the two are completely unrelated items.
because all of that money goes to systemmax. If people choose CompUSA over CC or the otherway around, it still goes to the same back account.... SystemMax
We could very well see a very well lit CC that will once again compete against BB.
If CC goes back into business ill be the first to fill out an application. Working there was so much fun. We do need some competition for bestbuy, people who work at bestbuy are such assholes same with walmart.
LOL i went into walmart today with my CC shirt, i had to look at cameras cause i need one, and the guess that worked there gave me a nasty mean look. I also listened to this guys trying to explain camera specs to a customer, he made shit up left and right.
i meant to say guys not guess, wow i feel dumb.
Sweet, more stores with TigerDirect prices means I will finally be able to get some hardware from a local store without paying an arm and a leg.
If I were offered my old job at my new job's pay... I'd be back in a heartbeat. CCity was a great company to work for, they just offered a poor selection of products and inconsistently (albeit consistently unwelcoming) store design. If Systemax transformed CCity the way they have CompUSA, I would gladly be a part of that team again.
Great a crappy company replaced by another, not quite but almost as crappy company. Just what consumers need.
why ChaosGS still here...still no job after CC when down?
Why yes i did get a new job, i will be working for Disney world this May.
I hope the receipts at the new circuit city stores shrink down to normal size. The old ones were monsters.
I know here in Jacksonville FL the two CompUSA storefronts that were taken over last year about this time are either in the same strip mall or across the road from closed CC stores. The two Orlando stores are a quarter-mile and two miles away from former CC storefronts. I doubt Systemax is going to want to keep two storefronts in such close proximity.
I hope they bring back the local circuit city, I don't shop at best buy. I bought my last two TV's from circuit city and they gave me very good deals.