Tuesday, November 11, 2008

Samsung's Circuit City Losses Covered? Hard To Believe

According to The Korea Times, CE giant Samsung claims that the entire $116 million that failing retailer Circuit City owes them is insured against default.

Samsung said all of its unpaid bills from Circuit City are insured and therefore Samsung won't suffer any losses.

If it's true that all of Samsung's $116 million in outstanding receivables with CC is covered by default insurance, then they've either been paying super-stiff premiums, or they've got an underwriter who was totally oblivious to the rash of bad news CC's had this past year.

*Hat tip to the excellent news site Retailer Daily for first linking to the Korea Times story.

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1 comment:

Brian J Munro said...

"Samsung won't suffer any losses."

I guess the damage to their reputation doesn't count. Nor will the marketplace chaos of having a liquidation receiver dumping $116 mil of inventory cause any loss to Samsung's dealer network. Nor will the inevitable warranty hassles that consumers will face after buying product from warehouse clearance sites that won't even give a customer the time of day hurt Samsung. Nor will cleaning up the stain in the boardroom after the insurance rep commits seppuku after delivering the settlement cheque cause any "loss". Not to mention I can't imagine what Samsung's insurance premiums will look like for the next decade.

Nope, no losses at ALL!