Unable to find a buyer or another way out of bankruptcy, Circuit City Stores, Inc. said Friday it will close its remaining 567 U.S. stores and sell off its inventory. Nine stores and more than 500 employees in Minnesota will be affected, according to the company's financial records.

Circuit City is the second largest consumer electronics retailer behind Richfield-based Best Buy Co. Inc. And in what analyst Jack Murphy of William Blair & Co. described as "one of the largest market-share opportunities in retailing," Best Buy stands to gain substantially from the demise of its closest rival.

About 82 percent of Circuit City's stores are within 5 miles of a Best Buy, according to Murphy's research, and he predicts Best Buy could see a 7 percent sales bump among established stores by February 2010.

In the dog-eat-dog world of retail, that's welcome news for Best Buy. It has about a 30 percent share of the consumer electronics market, but saw sales crash during the recent holiday shopping season. The company laid off about 500 workers at headquarters through voluntary buyouts and severely curbed its plans to open new stores.

Despite consumers' current lack of interest in electronics, Piper Jaffray analyst Mitch Kaiser thinks Best Buy can easily grab 20 to 30 percent of the $9 billion in sales Circuit City could ring in this year.

"Clearly nobody likes to see another company go out of business," Kaiser said. "But it's a reflection of Best Buy being far and away the superior operator" in consumer electronics.

Circuit City is the latest of several big retailers to succumb to the recession, credit crunch and drastic slowdown in consumer spending. This week, department store Goody's Family Clothing said it would liquidate and Gottschalks Inc. filed for bankruptcy protection while it tries to reorganize.

The International Council of Shopping Centers projects that some 73,000 stores will close this year, and the holes left by Circuit City's departure will further stress the nation's shopping centers.

In Minnesota, Circuit City has stores in Burnsville, Coon Rapids, Edina, Maple Grove, Maplewood, Minnetonka, Roseville, Woodbury and St. Cloud.

Employees who answered the phones in several Twin Cities stores said they didn't have information about sales, returns or how long stores would be open. Attempts to reach the corporate office in Richmond, Va., were unsuccessful.

Circuit City's Minnesota stores would be attractive to other merchants if the retail environment were stronger, said Richard Grones, founder of Cambridge Commercial Realty, an Edina firm that specializes in the retail market.

"They're well-located in good retail trade areas," he said.

But the vacant stores will come on the market at the same as time other large retail store space from chains such as Linens 'N Things, which has closed, and Cost Plus World Markets, which is closing its Minnesota stores.

"That puts a lot of similar boxes on the market," Grones said. "It's going to be challenging [for Circuit City] to find anyone to take over those leases."

Acting CEO James A. Marcum said in a statement Friday that liquidation was "the only possible path for the company. We are extremely disappointed by this outcome."

About 30,000 employees will be out of work.

Circuit City filed for Chapter 11 bankruptcy protection in November, after a potential sale to Blockbuster fell through over the summer.

Staff writer Susan Feyder contributed to this report. Jackie Crosby • 612-673-7335