In an announcement on March 27, retailer Grupo Gigante agreed to shell out $31.8m for the purpose of purchasing RadioShak de México.
In a plan to revamp and enhance RadioShack‘s Mexican business, Gigante will be purchasing 251 outlets (which showed around $115m of sales in 2014), trademarks and brands of the firm via Office Depot de México.
Earlier, Gigante had a joint venture with RadioShack, handling stores in Mexico from 1992 to 2008, before RadioShack Corp. stepped in to take over Gigante’s stake.
In February 2015, filing for bankruptcy protection as per Chapter 11, RadioShack had plans of selling half its US outlets to the hedge fund Standard General before shutting down the other half, a deal that is being vehemently challenged by other creditors.
According to Gigante, a change in business model was required for RadioShack de México, and Gigante was already full of plans to make it grow. In order not to increase its debt, the buy-out will be taken care of by Office Depot de México in cash.
Sale order confirmation from Delaware’s bankruptcy court, which is supervising the RadioShack process, as well as regulatory approval in Mexico is needed for the deal to come through.
Most of RadioShack’s supermarkets were sold in 2008, while it has been focussing on growing its other business. With 50% of Office Depot de México under its control, Gigante had bought the other half from Office Depot for about $690m in 2013. It also bought local retailer Comercial Mexicana’s restaurants as recently as last year.