Monday proved to be a day of mixed news for Circuit City. The troubled electronics retailer, with corporate headquarters in Short Pump, was granted a $1.1 billion loan in order to continue operating, the same day it was reported that sales at its stores dropped more than 50% in the 6 week period since it filed for bankruptcy.
An attorney for Circuit City told the judge at a hearing yesterday that sales had plummeted between 43 and 50 percent since the initial bankruptcy filing on November 10; more than twice what the company anticipated. That same judge, who approved the loan, also voided Circuit City’s contracts with several large companies, including Google, MGM Grand Hotel & Casino, and National Service Alliance, Inc. in an effort to help the company conserve cash.
Severance was also denied to 40 executives who were recently let go, although those employees have until Monday to file objections. The judge will also rule on January 29 whether Circuit City can terminate leases on 154 stores it recently closed.
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