Blackstone, TPG likely to drop out of RadioShack auction:sources

NEW YORK Tue Jul 20, 2010 6:38am EDT

A shopper looks over the mobile phones displayed at a Radio Shack store in Cambridge, Massachusetts in this April 28, 2008 file photo. REUTERS/Brian Snyder

A shopper looks over the mobile phones displayed at a Radio Shack store in Cambridge, Massachusetts in this April 28, 2008 file photo.

Credit: Reuters/Brian Snyder

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NEW YORK (Reuters) - Blackstone Group (BX.N) and TPG Capital are unlikely to continue to pursue a possible bid for RadioShack Corp (RSH.N), two sources familiar with the situation said on Monday.

The two private equity firms were working together to draw up a possible bid for the electronics retailer, which has a market value of about $2.7 billion.

The sources did not want to be named because the process is not public.

Bain Capital had been interested earlier but is no longer in the auction, sources previously told Reuters.

RadioShack has been exploring strategic options and hired Goldman Sachs Group Inc (GS.N) earlier this year to advise it.

RadioShack, which is trying to rebrand itself as "The Shack," has been focusing on its wireless business to offset weak sales of products like TV converter boxes, video game systems and batteries.

Bloomberg News first reported that TPG and Blackstone would likely withdraw from the auction. Blackstone and TPG declined to comment.

Other buyout firms have also expressed interest in RadioShack such as Advent International, sources previously told Reuters.

(Reporting by Megan Davies; Writing by Helen Chernikoff; Editing by Muralikumar Anantharaman)

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