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Blockbuster Denies Bankruptcy Exploration Rumors
by David Jenkins [Console/PC, Mobile Console]
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March 4, 2009
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Movie and game rental firm Blockbuster has hired law firm Kirkland & Ellis in what reports claim is an attempt to explore potential bankruptcy options, after share trading was halted on the New York Stock Exchange on Tuesday.
The company itself denies it faces bankruptcy -- spokeswoman Karen Raskopf tells Bloomberg, "We’ve hired them for refinancing and capital raising initiative... we do not intend to file for bankruptcy”.
The news is notable to the game industry thanks to the company's increased interest in stocking video games.
In particular, Blockbuster announced plans to add game rentals to its mail-based rental service last month. Earlier in 2008, the company revealed plans to 'significantly expand its game business' at all of its U.S. stores.
Two of the company’s credit facilities are due to expire this August, and Blockbuster has already confirmed it will be funding its own operations until the end of 2009. Blockbuster has not confirmed reports that investment bank Rothschild has also been hired to advise on restructuring.
Blockbuster has been criticized for being slow to adapt to mail-order and digital download rivals, and has faced particular competition from Netflix in the U.S.
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(drinking from my StarBucks sippy cup)