Blockbuster: Going Bust?

Blockbuster: Going Bust?

Many of us with kids of a certain age know the Friday night ritual: take the kids to Blockbuster to rent a movie.  That era may be going away as companies find that they no longer need expensive bricks and mortar stores to rent movies.  Next up for Blockbuster regardless of the long term prognosis is a chapter 11 filing in order to reduce its current debt load of 900 million dollars.  "The company is working with debtholders on a plan, under which it would continue operating but shutter hundreds more stores, said the source, who was not authorized to speak publicly about the situation. A bankruptcy filing is expected as early as Wednesday....Under the proposed plan, senior bondholders would convert about $630 million of debt into equity of the restructured company. The other bondholders would be wiped out...." 

Along with debt holders, landlords across the country will be hit hard as there are not many other tenants lined up to take these commercial spaces.  Here is a link.

Read more at TexasLawyerBlog.com

Comments

Matt
  • 10-05-2010

It is kinda sad that another institution like Blockbuster seems to fade away on the horizon of economic recession. 900 million dollars? How on earth did they accumulate so much debt? Doing what? But yeah, movie rentals, even with netflix, maybe a thing of the past soon the more online movie watching catches up. Couple that with internet/TV merging and it will be a lot more companies kissing goodbye.