Icahn 'Stands Ready' to Buy Circuit City
Richmond, Va. Blockbuster’s largest shareholder announced Friday that he is prepared to buy Circuit City if Blockbuster cannot secure financing or shareholder approval for the acquisition.
Circuit City Stores revealed Friday that it received a letter from Blockbuster which indicated Carl Icahn “stands ready” to buy Circuit City on his own should Blockbuster not be able to make the deal.
In related news, Circuit City also said Friday it will allow Blockbuster to review its books in connection with the video-rental chain's bid to buy the consumer electronics retailer.
In April, Blockbuster disclosed that it offered to acquire Circuit City for $6 to $8 a share in February. But Circuit City responded that while it was open to pursuing further talks, it was unwilling to let Blockbuster examine its books. The latest information represents a change of heart, as Circuit City is allowing Icahn and Blockbuster to conduct due diligence in connection with the proposed acquisition.
Circuit City has hired Goldman Sachs & Co. to explore strategic alternatives, which may include a sale. The board of directors, however, has not determined a specific path to pursue, according to the company.