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Friday May 9, 9:25 PMCircuit City to let Blockbuster conduct diligenceNEW YORK (Reuters) - Circuit City Stores Inc said on Friday that it will allow Blockbuster Inc and the movie-rental company's largest shareholder, Carl Icahn, to conduct due diligence in connection with Blockbuster's proposed acquisition of Circuit City.Circuit City also said it has hired Goldman Sachs & Co to assist it in exploring strategic alternatives to enhance shareholder value. Last month, Blockbuster disclosed that it offered to acquire Circuit City for $6 to $8 a share in February. But Circuit City responded that while it was open to pursuing further talks, it was unwilling to let Blockbuster examine its books, citing concerns about financing. Circuit City said on Friday that the movie-rental company responded to its request for information about its ability to finance the proposed deal. Circuit City said Blockbuster's response included a letter from Icahn stating that, subject to being satisfied with his due diligence review, Icahn and/or entities affiliated with him "stand ready" to purchase Circuit City if Blockbuster wrre unable to receive financing. In a sepSrate release, Circuit City said it will select three of Wattles Capital Management LLC's director nominees and include them as nominees of the board at its 2008 annual meeting. Wattles Capital Management had nominated five people for Circuit City's board. (Reporting by Nicole Maestri, editing by Gerald E. McCormick and Dave Zimmerman) |
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