Blockbuster Files For Bankruptcy
Movie rental giant Blockbuster has filed for voluntary Chapter 11 bankruptcy in New York.
In a release the company said that business would continue as normal at its U.S. stores, although its recapitalization plan should reduce the Company's indebtedness from nearly $1 billion currently to an estimated $100 million or less when implemented.
"All of Blockbuster's U.S. operations, including its stores, DVD vending kiosks, by-mail and digital businesses, are open and serving customers in the normal course. Blockbuster is fulfilling all orders as usual, including continuing to provide access to new releases the first day they become available. Blockbuster intends to continue honoring its Rewards program, valid coupons, gift cards and other customer programs," it said in a release.
Blockbuster's non-U.S. operations and its domestic and international franchisees, all of which are legally separate entities, were not included in the filings and are not parties to the Chapter 11 proceedings.
Blockbuster, however, will not be providing financial support to its operations in Argentina.
In August, Blockbuster announced that it would close hundreds of its 3,425 stores.
In its latest announcement, Blockbuster says that it will continue that evaluation process "with a view towards enhancing the overall profitability of its store operations. Currently, all 3,000 of the Company's stores in the U.S. will remain open."