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Electronics chain chairman buys Circuit City stake

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[November 18, 2008]  RICHMOND, Va. (AP) -- A Mexican billionaire who controls a chain of electronics stores in Latin America now holds a 28 percent stake in Circuit City Stores Inc., which is under bankruptcy protection.

Ricardo Salinas Pliego, who is on Forbes magazine's list of the world's richest people, owned more than 47 million shares of the nation's second-largest consumer electronics retailer as of Nov. 14, according to documents filed with the Securities and Exchange Commission late Monday.

InsuranceHe bought 30.3 million shares of Circuit City at average prices ranging between 22 cents and 26 cents apiece, days after the Richmond-based company filed for Chapter 11 bankruptcy protection last week, according to the documents.

The transaction raised Salinas' stake to 47.2 million shares, making him the company's largest shareholder based on outstanding share figures listed on Circuit City court documents.

It wasn't immediately known when the other 16.8 million shares were purchased because no previous filings for beneficial ownership exist. Salinas has not yet filed the SEC form required of those who hold more than a 5 percent stake in a company.

Circuit City spokesman Bill Cimino had no comment on the transaction. A spokesman for Salinas did not immediately comment because Monday was a holiday in Mexico.


Facing pressure from its vendors and from consumers who aren't spending, Circuit City filed for Chapter 11 bankruptcy protection last week and cut more jobs. The company, which has posted losses for seven of the last eight quarters, plans to keep operating while it develops a reorganization plan to deal with significant declines in traffic and heightened competition from rival Best Buy Co. and others.

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Circuit City listed HBK Investments as its largest shareholder with an 8.7 percent stake in court filings. Its next largest shareholders were listed as First Pacific Advisors and Mark Wattles with 7.4 percent and 6.5 percent respectively.

Salinas' fortune comes from television, retail and cellular businesses. He controls Grupo Elektra, with electronics, appliance and furniture stores in Mexico and Latin America; TV Azteca SA, Mexico's No. 2 broadcaster; and Banco Azteca, one of Mexico's largest microlenders.

[Associated Press; By MICHAEL FELBERBAUM]

Associated Press writer Julie Watson in Mexico City contributed to this report.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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