Circuit City Inc. (NYSE: CC) is nothing short of a tech retail disaster. The company can't even blame a weak US-consumer because its woes have been ongoing.
The poor technology and entertainment retailer said it is considering details of a proposal from 6.5% shareholder Wattles Capital Management that was made earlier this week. Wattles is seeking to basically replace the entire composition of the 12 member Board of Directors. Wattles has its own nominees.
Among the members of the board is CEO, President, and Chairman Phillip Schoonover. Wattles must agree with us that Schoonover needs quick removal, and he is one of our "10 CEO's To GO" since he has done such a poor job. About the only thing Schoonover hasn't done wrong is set up a money changing store inside where he pays $1.25 in pennies for each paper $1.00-bill because he thinks the base metals prices are too high.
The hardest part of this activist investor strategy is that this board is pretty entrenched. It also has noted that it is experienced and committed to building shareholder value in the turnaround plan, although you can see how well all of their experience has helped the stock performance.
The 2008 Annual Meeting is currently set at June 24, 2008 and we will eagerly await the Board and shareholder's (hopefully intelligent) decision. Circuit City shares are only up 1% at $4.58 in a weak market today and the 52-week trading range is $3.47 to $19.60.
Circuit City essentially rebuffs activist proposal
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