Circuit City Stores, Inc. (NYSE: CC) may have a party interested in finally turning it around. Ultimate Electronics owner Mark Wattles has added to his holdings in the troubled consumer electronics retailer to the tune of 11 million shares. He's been acquiring the shares since late last year and now owns 6.5% of the retailer. Best Buy, Inc. (NYSE: BBY) desperately needs a solid competitor, and maybe Wattles is the right person to give it one.Wattles, who built Hollywood Video into a powerful force in the video rental market and an entertainment industry veteran, could be interested in Circuit City. The retailer is primed for an acquisition soon. After announcing disastrous December sales and a plethora of bad news, Circuit City is on the ropes and its CEO may be shown the door soon.
Wattles, who serves as Ultimate Electronics's CEO after taking control in a 2005 bankruptcy auction, has publicly indicated that he wants to expand Ultimate's store count. How better than to grab a national chain with plenty of locations at a fire sale price? Right now, Circuit City shares are sitting at $4.83, down from its 52-week high of over $22. Is Circuit City being primed for a buyout? If not, it may go further down the tubes soon unless it completely re-invents itself.
