Circuit City urged to give info to Blockbuster

LAS VEGAS Wattles Capital Management reported that it has sent a letter to Circuit City's board of directors urging them to provide Blockbuster access to due diligence information and commence good-faith negotiations, as well as demanding that Circuit City's board simultaneously seek out other parties potentially interested in acquiring or otherwise entering into a material transaction with Circuit City.

According to Wattles, it would be in Circuit City's best interest to consider Blockbuster's offer to buy the retailer for up to $1.3 billion, namely because Blockbuster is not a competitor of Circuit City so providing such information poses no competitive threat, Blockbuster's board fully supports the offer and Carl Icahn, or an affiliate, appears willing to and capable of helping to finance the offer.

"We believe that an acquisition for between $6 and $8 per share is in the best interest of Circuit City shareholders. We urge the Board to act quickly to allow Blockbuster access to due diligence materials and to begin negotiating with Blockbuster so that they can make a definitive proposal at the high end of their offer's range," the letter said.

Wattles also insisted that Circuit City consider other offers take the necessary steps to create a competitive bidding process in order to maximize shareholder value.