After filing for bankruptcy, Blockbuster will now be auctioning its operation off to the highest bidder.
On Monday, Blockbuster announced that it will be auctioning off its operation to the highest bidder, after the management was offered $290 million for its international and U.S. subsidies. Without much hesitation the company has agreed to an arrangement in which the $290 million will be used as the minimum amount the company will accept for its sale.
After many years of successfully providing movies to their loyal customers, Blockbuster has been dying a slow and painful death at the hands of Netflix and similar, cheaper movie renting alternatives. In 2009, Blockbuster closed nearly 1,000 stores due to profit losses which didn't do much for the company's stock value. After the company's stock was taken off of the New York Stock Exchange due to its low value, the company was forced into a corner and filed for bankruptcy.
Now in the middle of Chapter 11 bankruptcy, the company must first obtain authorization from the U.S. Bankruptcy Court in order to hold an auction for its sale. Despite the grim future of Blockbuster, the company's CEO Jim Keyes is confident that the buyer of Blockbuster will have made a great investment.
"The purchaser will be able to take full advantage of Blockbuster's many strengths, which include an internationally recognized brand name, an exceptional library of more than 125,000 titles, millions of loyal customers, and a multi-channel content distribution platform," Keyes explained. "Because of its ability to deliver physical content (through DVDs) and digital content (through streaming), Blockbuster can offer customers the unique ability to access any movie, any time."
Blockbuster is expected to be sold by April 20 at the latest and any binding offers made must be able to close within 30 days of approval by the U.S. Bankruptcy Court. While the auction and sale continues, the company's U.S. and international stores and operations will still be in business.
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