Wattles, Circuit City Trade Volleys Again
In his latest communication to Circuit City board members, activist investor Mark J. Wattles urged the company’s board to cooperate with Blockbuster’s attempt to purchase the company, and to provide Blockbuster with access to its books.
Meanwhile, Circuit City responded by stating that its investment bank, Goldman Sachs, had advised them that “Blockbuster cannot in fact consummate the proposed transaction in light of the difficult current financing environment.” However, they left the door open for Blockbuster to propose “a viable financing structure that is predictably executable,” which would be the only scenario under which negotiations could proceed. s
In the letter, filed on behalf of Wattles Capital Management, Wattles complained that the company’s management has been “unwilling to allow what appears to be a bona fide bidder interested in acquiring Circuit City to perform due diligence has justifiably caused some skepticism on our part regarding the current Board’s willingness to take all steps necessary to maximize shareholder value.”