TigerDirect to buy CompUSA stores

Jan 08, 2008 (The Miami Herald - McClatchy-Tribune Information Services via COMTEX) -- CPU | news | PowerRating | PR Charts -- The CompUSA name and many of its Florida stores will get a new lease on life, thanks to the parent company of Miami's TigerDirect.

Systemax, which owns TigerDirect, agreed to buy up to 16 CompUSA stores in Florida, Texas and Puerto Rico from the struggling Dallas-based company that last month announced liquidation plans. The deal also includes the CompUSA brand name, trademarks and website.

The $30 million cash deal, which will close in stages starting this week, will be funded by Systemax cash reserves.

"The CompUSA brand is a huge name," said Gilbert Fiorentino, chief executive officer of TigerDirect, which will merge the CompUSA stores and website into its existing operations. "We've had an opportunity to look inside and get the assets that make sense."

The exact CompUSA store locations will not be disclosed until after Systemax receives approval from landlords on transfering the leases.

But the deal is expected to include the majority of the Florida and South Florida stores. CompUSA has 17 stores in Florida, including South Florida locations in Kendall, Miami, Plantation, Pembroke Pines, Fort Lauderdale and Deerfield Beach.

CompUSA announced in December that it was being sold to Gordon Brothers, who planned to sell as many of the remaining 103 stores as possible and close the rest. The privately-held retailer was owned by Mexican billionaire Carlos Slim and his Mexico City-based Grupo Carso. But CompUSA has struggled for nearly a decade with falling prices on PCs and competition from Best Buy, Wal-Mart and other big box retailers.

CompUSA announced in December plans to lay off 150 people next month from three South Florida stores -- in Pembroke Pines, Kendall and Deerfield Beach.

Once the sale to Systemax is completed over the next month, the CompUSA stores and website will be run out of TigerDirect's West Miami-Dade headquarters.

The move will give TigerDirect a major jump in its efforts to grow its retail presence. The Miami company has done most of its business through its catalog and website, but has been expanding retail operations in recent years.

TigerDirect now has 11 retail stores and another three under development, all of which will be converted to the CompUSA name. The company has two retail stores in the Miami area, one at the Mall of the Americas and another across the street from The Falls in South Miami-Dade.

"We've already had an aggressive growth strategy, but this gives us a great boost," said Fiorentino, who founded TigerDirect in 1987 with his brother and a partner, then sold the company in 1995 to the publicly-traded Systemax.

At any of the CompUSA stores it takes over, TigerDirect would expect to keep most of the employees, Fiorentino said.

The expansion may lead to an addition of a dozen jobs at TigerDirect's Miami headquarters. TigerDirect now employs about 1,300 people in North America, including about 600 at the Miami headquarters and adjacent store.

Systemax did not disclose the impact of the acquisition on earnings. For the first nine months of this year ending Sept. 30, 2007, Systemax reported sales of $2 billion and net income of $45.3 million or $1.20 per diluted share.

"Part of the reason this is so attractive is that with the existing infrastructure we can absorb most of this business," Fiorentino said.

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