Monday, September 21, 2020

WILL BLOCKBUSTER SHUT DOWN?

February 22, 2011 by · 1 Comment 

In what appeared to some analysts as yet another step toward the disappearance of the familiar blue façades that have been a part of the U.S. retail scene for the past quarter-century, Blockbuster on Tuesday agreed to sell itself to a so-called stalking horse consortium of its debtholders for $290 million in a deal that would allow the new owners to liquidate the company’s assets. Some 600 Blockbuster stores will be shut down before the end of next week, the new owners said. However, they added, the majority of stores will remain open. Questions remained as to whether billionaire Carl Icahn, who has bought up a large position in Blockbuster’s debt (while selling off his stake in the video rental company at a huge loss), will make any effort to block the new deal. The $294-million pricetag illustrates how far the company has fallen since online renters, video-on-demand providers, and kiosks began competing. In 1954 Viacom bought the company for $8.4 billion. (It spun it off five years later.) The new maneuvers have no effect on Blockbuster kiosks, which are operated by manufacturer NCR and which have simply licensed the Blockbuster name and logo.