Bell Canada has negotiated to buy certain assets of InterTAN, the Canadian subsidiary of bankrupt Circuit City, for an as yet undisclosed amount. Ron Cuthbertson, who will be reinstalled as InterTAN's President, and who was part of the team engineering the Bell Canada bid, talked to me at length today.

During the conversation, I apprised him that the court documents refer to the "Asset Purchase Agreement.," rather than the sale of the company as a whole. Cuthbertson said that because InterTAN is being sold as an asset of bankrupt Circuit City, this unusual purchase, as he referred to it, is subject to out of the ordinary legal parlance.

Contrary to reports in the mainstream media, Bell Canada has not contracted to buy the 756 The Source by Circuit City stores, but rather certain assets of InterTAN. "I will tell you," said Cuthbertson, "that there was no activity on our part, whatsoever, to decline taking any dealers, joint ventures, or store leases that existed today. We are basically moving forward with the business as the business was. The concern of the dealers for their business is perhaps more the concern of the unknown, because they haven't found the information on the monitor's Website, or they haven't had a question answered. Again," he continued, "there is the unusual process by which this has come about, with the court's involvement."

The Bell Canada proposal offers take over all leaseholds of corporate stores, continue the joint venture store operations, honour written executive contracts, offer comparable jobs and terms to all corporate employees, of which there are over 3,000, and honour union contracts of workers at InterTAN's warehouse in Barrie, ON. Nevertheless, the court documents filed on March 2 and posted on the monitor's Website do not seem to indicate specifically that it will continue relations with franchised authorized dealers who operate 263 stores under The Source by Circuit City banner.

In fact, item section 31of InterTAN's proposal for sale deals with assets excluded from the deal. Paragraph g of Section 31 specifically excludes "any and all contracts between InterTAN and its affiliates." Cuthbertson said he was constrained from talking about included and excluded assets at this time.

Bell Canada, according to my reading of the proposal, will be buying a clean company. Bell seems to be distancing itself from all current receivables and payables. Bell Canada corporate spokesman Mark Langton also assured me that "Bell has no plans to change any of The Source's dealer relationships or to reduce their number. When we say we're acquiring more than 750 The Source locations, that includes the licensed dealers of course. Barring normal course of business changes," Langton added, "that's the number we would expect The Source to continue to operate going forward."

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