Los Angeles – Video rental giant Blockbuster (NYSE: BBI) told the six
major movie studios that it is preparing to file for bankruptcy next month, the
Los Angeles Times reported, citing sources. The company is strapped with nearly
$1 billion in debt and unwanted leases on more than 500 of its underperforming
rental store locations, and has lost a total of $1.1 billion since the outset
Blockbuster is likely to enter a "pre-planned bankruptcy,"
wherein many creditors are included in the process before the court weighs in.
The company, which has already shuttered more than 1,300 stores, has faced
increasing competition in DVD rentals from Netflix and Redbox, and in the home
video market from pay-TV video-on-demand, as well as online services like
(Los Angeles Times)
(DMW previous coverage)