Blockbuster Filing For Bankruptcy Soon
Here’s the story from AP:
Troubled video-rental chain Blockbuster Inc. could file for bankruptcy protection as early as Wednesday, according to a Wall Street Journal article.
Citing unnamed sources, the Journal said Blockbuster is working with creditors to develop a bankruptcy restructuring plan that would free it of debt and allow the company to keep some stores open and focus more on digital distribution.
If Blockbuster misses an interest payment on Sept. 30, more than $900 million in debt will be due in full.
The article says billionaire investor Carl Icahn owns one-third of Blockbuster’s debt and would return to the company’s board once it exits Chapter 11. He resigned from the board in January.
Blockbuster and Icahn did not return calls for comment.
Once a home entertainment powerhouse, Blockbuster, based in Dallas, has been losing market share for years as more consumers switch to video subscription services like Netflix Inc., video on demand services and curbside rentals such as Redbox.
Blockbuster peaked at about 9,100 stores in 2004, but it has since shut many to cut costs and is down to about 5,800 as of August. In the same period, Netflix membership has grown from 2.6 million to about 15 million.
I grew up in the middle of nowhere, so to be honest I don’t know that I’ve ever even been in a Blockbuster. I also am a huge fan of Netflix. Still, it’s sad to see the end of an era.