*There was a day not so long ago when renting videotapes was considered the service-job of the future. Presumably those guys are all home, unemployed, and pirating videos now.
http://www.latimes.com/business/la-fi-ct-blockbuster-20110222,0,1997128.story
Blockbuster to put itself up for sale
Blockbuster submits a plan for auction in U.S. Bankruptcy Court. To set a floor on price, a group of creditors puts in an opening bid of $290 million.
By Ben Fritz, Los Angeles Times
February 21, 2011, 7:02 p.m.
"Home video chain Blockbuster Inc. has opted to put itself up for sale after a previous bankruptcy reorganization plan collapsed and its business continued to deteriorate over the holidays.
"The struggling Dallas company submitted a plan Monday for an auction process to U.S. Bankruptcy Court in New York. A holding company formed by four of its largest creditors — Monarch Alternative Capital, Owl Creek Asset Management, Stonehill Capital Management and Varde Partners — has put in an opening "stalking horse" bid of $290 million.
"The offer is intended to draw other buyers and create a floor on a price. If no other bids are submitted, however, the four creditors would end up controlling the DVD rental and sales company. (((Kind of amazing that they managed to move from analog tapes to digital DVDs without collapse.)))
"In a statement, Blockbuster Chief Executive Jim Keyes said the company hoped to draw offers from both strategic and financial investors. "This will ... allow for the consolidation of ownership of the company to those with a clear and focused vision for Blockbuster's future," he said. (((In dead media studies, nobody ever mentions "a clear and focused vision" for death. There's never a graceful exit strategy, even though the writing's been on the wall for this enterprise for years.)))
"Billionaire Carl Icahn, the largest owner of Blockbuster's debt, is not part of the stalking-horse bid but could still make a play for the company, according to speculation raised in recent news reports. He rapidly bought up the company's bonds in late summer and early fall of 2010, leading some in the entertainment industry to believe he was looking to take control and potentially combine it with the movie studios Metro-Goldwyn-Mayer and Lions Gate Entertainment, which he was also pursuing at the time.
"Icahn could not be reached for comment. (((People think privacy is dead due to Facebook and such, but you know, billionaire moguls have lots.)))
"Blockbuster filed for bankruptcy protection in September as its once-dominant market position collapsed in the face of competition from lower-cost, more digital-savvy rivals such as Netflix Inc. and Redbox Automated Retail. (((They won't last long either, but if you pointed that out to 'em, they still wouldn't do anything practical.))) At the time, its senior secured bond owners said they intended to exchange their debt for full ownership of the company. But that plan is no longer viable, Blockbuster said in its filing, in part because of the continued worsening of its financial picture. During the five weeks that ended Jan. 2, Blockbuster had a net loss of $11.7 million on $206.5 million in revenue.
"The company has continued to cut costs in the meantime. It is scheduled to begin closing 609 of its roughly 3,400 U.S. stores by Feb. 28.
"In its court motion requesting that it be allowed to find a buyer, Blockbuster said that was the company's only remaining option to continue operating and avoid liquidation..."
