THE VIRGINIAN-PILOT
Copyright (c) 1997, Landmark Communications, Inc.
DATE: Wednesday, February 5, 1997 TAG: 9702050657
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY TOM SHEAN, STAFF WRITER
LENGTH: 29 lines
After climbing as high as $22 on their first day of trading, shares of the Circuit City Stores-CarMax Group closed at $21.12 Tuesday for a gain of $1.12.
Slightly more than 13 million shares changed hands after an initial public offering of 21.86 million shares in Circuit City's auto-retailing unit.
The Circuit City-CarMax shares is trading on the New York Stock Exchange under the symbol KMX.
Underwriters for the offering expanded the size by three million shares from the planned 18.86 million because of strong investor demand. Underwriters also boosted the offering price to $20 from the proposed price range of $15 to $17 a share.
Richmond-based Circuit City, which will raise more than $400 million from the offering, said it plans to use the funds to expand CarMax's operations and to repay debt.
Known for its nationwide chain of electronics and appliance stores, Circuit City has expanded its auto-retailing subsidiary to six stores from one over the past three years. Circuit City said it plans to have as many as 90 CarMax stores by 2001.
For the nine months ending in November 1996, CarMax rang up sales and revenues of $375 million. That was an 85 percent increase over sales for the comparable period in 1995. However, CarMax has yet to post a profit.