Dallas – Video rental giant Blockbuster (NYSE: BBI) on Thursday announced
that it has filed a pre-arranged plan for Ch. 11 bankruptcy, which would reduce
the company’s debut from the current nearly $1 billion to $100 million or less.
The recapitalization plan includes $125 million in debtor-in-possession
financing that will keep the company’s stores, kiosks and online services in
operation during the bankruptcy process, and another up to $50 million in
credit to help re-start when it exits.
The filing states that Blockbuster’s
total current debt is $1.465 billion, while assets were listed at over $1
The company’s largest creditors include the movie studios, with $21.6
million owed to Fox, $20 million due to Warner Bros., $13.3 million to Sony
Pictures, $8.6 million to Disney, $8.3 million to Universal and $7.9 million to
"The recapitalized Blockbuster will move forward better able to
leverage its strong strategic position, including a well-established brand
name, an exceptional library of more than 125,000 titles, and our position as
the only operator that provides access across multiple delivery channels —
stores, kiosks, by-mail and digital," stated CEO Jim Keyes.
(Los Angeles Times)