Three bidders are involved in negotiations to acquire Circuit City, but the outright liquidation of the company's assets remains the most likely outcome. The bankruptcy court has set a Friday deadline for the company to reach a deal with a buyer and while an extension is possible, nothing has been agreed to so far.

According (subscription required) to The Wall Street Journal, Golden Gate Capital is the bidder most likely to gain ownership of the company, but Mexican billionaire Ricardo Salinas Pliego is also in the running. His firm owns more than 1,000 electronics stores in Latin America. Hilco Merchant Resources and Gordon Brothers Retail Partners are also pairing up to make an offer.

The company's results have deteriorated even more than was expected since the bankruptcy filing. Putting aside the short-term macroeconomic problems, Circuit is being squeezed by Best Buy (NASDAQ: BBY) on one side and by Wal-Mart (NYSE: WMT) on the other. There's really no reason for the company to go anywhere other than liquidation, and that's what is likely to happen.

It's a cruel blow to the company's 30,000 employees, who are likely to lose jobs because of incompetence at the highest levels of the company.