Blockbuster has been sold at auction to satellite TV chain Dish Network for just $320m, after the once dominant video chain was pushed into bankruptcy by online competition from the likes of Netflix and LoveFilm.
Dish Network, a provider of subscription-based satellite-TV services, said that it expected to pay only $228m for the company, after “certain adjustments” on cash and inventory are made.
Once a network of more than 7,200 stores in the US and 17 other countries including the UK, Blockbuster declared bankruptcy on September 23 and went into Chapter 11 reorganisation with one billion dollars in debt. By that time, it’s number of stores had fallen to just 1,700 worldwide.
It fell victim to competition from low-priced mail delivery of movies by Netflix, kiosk rental outlets such as Redbox, and online on-demand movie and TV services from Netflix and others, including Dish Network.
“With its more than 1,700 store locations, a highly recognizable brand and multiple methods of delivery, Blockbuster will complement our existing video offerings while presenting cross-marketing and service extension opportunities for Dish Network,” said Dish’s executive vice president Tom Cullen.
“While Blockbuster’s business faces significant challenges, we look forward to working with its employees to re-establish Blockbuster’s brand as a leader in video entertainment,” he said in a statement.
