Bankruptcy judge OKs bidding for RadioShack store leases

RadioShack today received bankruptcy court approval of bid procedures for auctioning hundreds of store leases.

U.S. Bankruptcy Judge Brendan Shannon approved the procedures at a hearing this morning in Wilmington, Del. The specifics will be outlined in an order to be filed later in the day.

Shannon also gave the retailer permission to continue running store-closing sales and approved a pre-bankruptcy consulting agreement with liquidators. As many as 2,100 stores are to be closed under a deal with the liquidators, Hilco Merchant Resources, Gordon Brothers Retail Partners and Tiger Capital Group. The retailer started closing stores last week.

Fort Worth-based RadioShack, with about 4,000 company-owned locations, sought protection from creditors Feb. 5, saying it wanted to close “as many stores as possible.” It has an agreement to sell 1,500 to 2,400 of its locations to a unit of hedge fund Standard General, its biggest shareholder.

Standard General has a deal with wireless carrier Sprint Corp. to set up stores-within-stores at as many as 1,750 locations.

Other creditors are challenging that sale, alleging that it is an inside deal that will discourage bidding from other parties which could bring a higher price.

This story was originally published February 20, 2015 at 11:54 AM with the headline "Bankruptcy judge OKs bidding for RadioShack store leases."