Richmond, Va. Struggling consumer-electronics retailer Circuit City Stores Inc. said Wednesday it has increased its credit line by $800 million and extended the expiration date to 2013, according to a regulatory filing.
In a filing with the Securities and Exchange Commission, the company said it has increased its available borrowings up to $1.3 billion from $500 million and extended the expiration date to Jan. 31, 2013, from June 27, 2009.
"We have a difficult economy, we have fierce competition and we're in the middle of some of the most difficult, deepest work in the transformation work," chief executive Philip J. Schoonover said in an interview with The Associated Press.
Schoonover said the credit line gives Circuit City liquidity and access to the capital markets to continue the turnaround "even if the economy doesn't support us or if competition gets tougher for a period."
The credit also puts the company's large vendors at rest and allows them to keep moving forward with Circuit City, Schoonover added.
Circuit City may use the credit facility for working capital, letters of credit, capital expenditures, acquisitions, share repurchases, dividends, repayment of debt and other general corporate purposes. The amended credit agreement also provides Circuit City the option to increase its total borrowings by up to $300 million.
As of Feb. 4, the company had a total of $49.7 million outstanding under the facility.
The consumer electronics retailer on Wednesday also gave select reporters a tour of its new concept, "The City,” which has been rolled out to 14 locations.
The stores offer a refined product selection and a more interactive experience. Employees use tablet-styled computers when helping customers, giving them access to inventory, prices and technical specifications of products.
The company said in December that it planned to open 61 to 63 new and relocated stores in fiscal 2008; two-thirds of the openings will be the new 20,000-sq.-ft. format.