What is Jim Keyes, Blockbuster's CEO up to?

The news that Blockbuster had previously approached Circuit City back in February about a potential acquisition and after being ignored, Blockbuster appears to be ready to go hostile has resulted in a predominance of criticism from the financial and business communities.

The most common response one reads or hears is twofold; why would two struggling retailers with different businesses wish to merge and how can Blockbuster whose stock has been pummeled manage to finance such an acquisition?

Check the satirical spin on the situation from Jack Flack of Portfolio.com. He seems to have brought some insight to the situation.

While I do not typically comment on potential acquisitions, I have a slightly different take on the situation specifically from a management change perspective.

Blockbuster's CEO, Jim Keyes, a former successful CEO at 7 Eleven, is anxious to find a way to rely on his talents as a successful merchandiser to turn Blockbuster around. Unlike his critics, who right now are many, he is thinking like the former CEO he was back at 7 Eleven. He believes he can find a way to turn the fortunes of both companies around as one firm. We will just have to see how this situation plays out.

For more:

Wall Street Journal (4/15 update)
Los Angels Times (4/15 update)

BloggingStocks
Seeking Alpha

Deal Journal

Newsvine

ABC (video)

All Things Digital

CFO.com

Intutitive.com

Fortune

CEO Watch - Philip Schoonover, Circuit City, Update 2

Circuit City, the embattled electronics retailer, (check my earlier blogs) continues to face pressures from numerous sides. Chris Wattles of Wattles Capital Management, a major shareholder in the firm (approximately 6.5% of shares) has remained a thorn in Schoonover's side for some time.  Today he made a new call for the CEO's head as well as a number of other changes.  In a letter to Circuit City's board of directors Wattles stated,

We are confident that, with the right senior management team, the right strategy and the right focus, Circuit City can overcome its operational problems and turnaround its struggling business. WCM's primary goal is to help restore investor faith in Circuit City and unlock the Company's significant unrealized value by pushing for the following immediate

changes:

    -- Replace the current Chairman and CEO with a seasoned executive capable

       of restoring credibility with employees, vendors and stockholders;

    -- Focus on the "customer experience" and strategies for making the

       current stores more productive;

    -- Begin addressing the actual issues facing the Company and drive revenue

       growth, rather than focusing on cost-cutting strategies and "spin"

       campaigns.

    -- Focus on the most immediate and least capital-intensive opportunities

       to improve the health of the business; and

    -- Develop and articulate a deliverable promise for the new "The City"

       brand that works within the realities of the current store footprints.

While Wattles' pressure is unlikely to result in getting Schoonover's head in the near-term, the current CEO's timeframe for success appears to be shrinking.  Continue to keep a close eye on how Circuit City responds to Wattles' pressure and the firm's shrinking profits and options for turning the company around.