Dive Brief:

• RadioShack, in an internal memo obtained by Bloomberg this past weekend, said it will stop matching its employees’ 401(k) and 1165(e) contributions on Feb 1.

• The electronics retailer’s CEO last week also hit back hard against two of its lenders, Salus Capital Partners and Cerberus Business Finance, which pushed back against a recapitalization agreement with Standard  General that they say violates the terms of the loans. Salus has demanded immediate repayment of its loan.

• CEO Joe Magnacca seemed angry about the news, saying that the lenders were making it difficult for the retailer to engineer its turnaround. Indeed, Salus in the past has blocked the retailer’s efforts to close stores. 

Dive Insight:

RadioShack is on the brink, and has been for a while. Yet, at a crucial time for any retailer, the limping chain is facing another round of difficulties from its own financing partners. The end of matching funds for employee retirement plans is part of a wider cost-cutting effort that may not be good enough if Salus and Cerberus call in their loans.