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Game Over, Radioshack LBO Rumors, Game Over
The day every sane investor has been waiting for is here - today marks the end of the Radioschack LBO rumors. After 3 years, 4 months, 50 days. 8 hours and 44 seconds (give or take) of hourly rumormongering that the increasingly irrelevant electronics retailer was supposed to be bought "any given day now" at a 10x+ EBITDA multiple by each and every PE firm in the universe, and with allegedly intelligent investors falling for it each and every time, it appears the end is here. Incidentally, according to preliminary calculations, a dedicated investor that would have done nothing but short RSH on every rumor spike would have returned about an 80% CAGR over the past 3 years. Couple this with selling RSH CDS and the ROI would have been the highest recorded in human history. From Reuters: "Blackstone Group and TPG Capital are unlikely to continue to pursue a possible bid for RadioShack Corp (RSH.N), two sources familiar with the situation said on Monday. Bain Capital had been interested earlier but is
no longer in the auction, sources previously told Reuters." And with this, an entire section of rumor disseminators at the NY Post will suddenly find themselves praying Congress passes the unemployment extension bill later today.
More facts from Reuters:
RadioShack has been exploring strategic options and hired Goldman Sachs Group Inc (GS.N) earlier this year to advise it.
RadioShack, which is trying to rebrand itself as "The Shack," has been focusing on its wireless business to offset weak sales of products like TV converter boxes, video game systems and batteries.
Bloomberg News first reported that TPG and Blackstone would likely withdraw from the auction. Blackstone and TPG declined to comment.
Other buyout firms have also expressed interest in RadioShack such as Advent International, sources previously told Reuters.
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Another business that hasn't developed with the times, a fatal mistake.
Uh oh.. no more $1+ pops on RSH only to fade out over the rest of the trading day.
Faded into irrelevance. They maybe made sense at a time when you really absolutely had to have a bag of overpriced capacitors on a Sunday afternoon.
Where will people buy their circuitry breadboards now !?
All 'dependable' trades become oxymorons. (they're like banging the back door on a fat chick, fun while they last as long as your friends don't find out)
Sad to see them go ;(
They lost their way many years ago, any thing technical asked and you see the sales person slowly drift over to the cell phone display hoping to sell you a cell phone no matter what. "You got questions we got blank stares"
When you're selling resistors/capacitors which cost about $0.40 cents each, and you have a whole shop full of this cheap stuff, and you're a paying a staff member around $15 an hour, there is really no way of making a profit, Half the people that walk in there, just knick it as it really easy to steal it, The business needed to upgrade and they failed to do so, hence it relevance and importance just faded away
Every 3 years when my car's 49 cent keyless entry battery dies, the first place I think of is Radioshack. And the individual attention I receive when buying a new one is fantastic, as I am always the only customer in the place.
I have had many similar experiences. I'm sure you can get all those little electronic do-dads on the Internet but that doesn't do you much good when you're sitting around the house on Sunday afternoon trying to fix something.
Weirdly, if the S ever really does HTF and instant, brand new consumer product gratification isn't really a viable default choice for a lot of people, I would think Radio Shack would do well in that kind of nuts and bolts business. Of course now that most Americans lack the hands-on skills to operate a sponge effectively I guess that's a moot point too...
I love the fact that I can run out to a retail store and get a mini-stereo-phone-jack-to-dual-RCA converter in the middle of a project. At the same time I wonder why this is so? I have never spent more that $10 at a time. Their consumer electronics is unexiting and overpriced, and there isn't room for much selection.
I also remember getting milk delivered to our door every morning. It came in a funny shaped bottle so you could pour off the cream using a special spoon, or just shake up the bottle to make whole milk. That was neat too. How come the milk bottles are gone but RS is still here?
Obviously this comment has no real purpose, just a fit of nostalgia.
Radio Shack has been getting more and more useless as the years go on. They have less and less of the items people actually go there to find and have more and more overpriced cellphone plans and useless crap.
I guess it's not their fault that the American populace has has been getting dumber and dumber to the point where noone even knows what a resistor is.
That's the sad part: If they did carry all the stuff they used to and staffed theur stores with knowledgeable people (who cost more to employ) then they would have been bankrupt long ago. The education system delivered what was intended form the start: a dumb predictable consumer who would rather replace than fix and would rather buy than build.
I won't contradict your evaluation of the populace. But nobody can fix electronic stuff any more. I know what a resistor is but I haven't seen one as a discrete component in many years. Open up an HDTV and you will find a circuit board with a bunch of thin IC's, each surface-welded to the board by dozens or hundreds of tiny gold pins. Somewhere in each of these there are thousands (if not millions) of resistors, capacitors, and transistors each too small to see with a microscope even if they weren't embedded in black plastic.
If someone sends their set in for warranty repair, one of three things will happen: a tech will unplug and reconnect all the cable connectors and the thing will start working again; they will replace the motherboard which essentially is the entire tv; or a "refurb" will be sent back as a substitute. Usually these are working sets that someone else returned to the store open-boxed for some reason.
Resistors and capacitors are still used in LCD tvs and monitors.
Radio Shack: Cool to Geeks when it wasn't cool to be a Geek.
Radio Shack, they sold those little cube weather radios, right? I had one of them back in the day.
I've gotten quite a few items for my survival gear from Rat Shack. This just makes me wonder who will have the electronic goodies after SHTF.
Those of who are preparing for the hard times ahead of us take note. After food/water, communications is #2 on the survival list. Tube communications equipment will be here to stay.