RadioShack Corp. said it is in talks with investment banks on ways to bolster its finances, as the money-losing electronics chain works to remake its image and reverse sliding sales.
The 94-year-old company lost $139 million last year and has struggled to keep up as electronics retailing shifted to the Web and consumer tastes changed.
Seeking to assuage investor concerns that it could run short on cash, the junk-rated retailer said Friday in a press release that it has “a strong balance sheet” with $820 million in available cash and borrowings at the end of March. The Fort Worth, Texas-based company also said investment banks are helping it evaluate ways to strengthen its finances.
RadioShack has had discussions with advisers at Morgan Stanley and Centerview Partners, according to people familiar with the matter. The company is hoping to raise money ahead of the fall, when it will be stocking up on inventory for the holiday shopping season, the people said.
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A RadioShack spokeswoman said the company wouldn’t discuss bank names or financing, and expects “only normal inventory build” leading into the holiday season.
Shares of RadioShack rose 11% Friday to $2.92. They had dropped sharply Thursday, when the trade publication Debtwire said the retailer was looking to hire a financial adviser to help fix its balance sheet. The shares have lost roughly 90% of their value over the past three years. The company, which had annual sales of $4.3 billion, sports a market cap of $291 million.
Date: July 12, 2013