Dish buys bankrupt Blockbuster for $228 million in cash

By on April 6, 2011, 9:57 AM
As expected, Blockbuster has been auctioned off. Dish Network Corporation has announced that it was selected as the winning bidder in the bankruptcy court auction for substantially all of the assets of Blockbuster.

The winning bid was valued at approximately $320 million, but after certain adjustments are made at closing of the transaction, including adjustments for available cash and inventory, Dish expects to pay approximately $228 million in cash to acquire Blockbuster. The closing of the transaction is expected to occur in the second quarter of 2011.

Dish, led by satellite billionaire Charlie Ergen, beat out at least three other bidders, including billionaire investor Carl Icahn, and South Korea's SK Telecom. Dish might use Blockbuster's online content as a base for an online product to deliver movies, but competition is only getting tougher in this space.

Blockbuster was once the world's largest video chain with a market cap of more than $5 billion at its peak in 2002. It started to fall apart after pressure from mail-order and digital competitors such as Netflix.

In September 2010, Blockbuster filed for Chapter 11 bankruptcy protection in the US. Two months ago, Blockbuster asked the New York bankruptcy court overseeing its Chapter 11 case to allow it to conduct an auction for the company. The company decided to put itself up for sale after a reorganization plan fell apart late last year.

"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," Tom Cullen, executive vice president of Sales, Marketing, and Programming for DISH Network, said in a statement. "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."




User Comments: 11

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motrin said:

i look forward to see what DISH Newwork will do with this. Hopefully there current customers will get some benefits.. hha like me!

TorturedChaos, TechSpot Chancellor, said:

I remember when Blockbuster pulled out here - everything on sale . PS3 games for $5.00ea.

It did make me a little sad tho - that store had been there since as long as I can remember. Lots of good memories renting movies from there when I was a kid.

But now I just started a Netflix membership, and I can't imagine going to a store to rent movies.

Cota Cota said:

Now thats a lot of DVD's to play putting in the microwave. Now only i wonder what is Dish doing whit it? hopefully they do something good to improve their service, since im a costumer too :P

oh! snap almost forgot *plays the world's smallest violin"

Guest said:

Why the F was a foreign country (Korea) was allowed to bid!?

thank god they didn't win it...just getting rid of all the US wealth.

gwailo247, TechSpot Chancellor, said:

228 million? I lose more than that running for the bus.

matrix86 matrix86 said:

gwailo247 said:

228 million? I lose more than that running for the bus.

.....huh? I don't understand what you mean there, but anyway, you have to remember that BB is bankrupt, so they aren't worth very much.

gwailo247, TechSpot Chancellor, said:

.....huh? I don't understand what you mean there, but anyway, you have to remember that BB is bankrupt, so they aren't worth very much.

That's a line from Snatch.

matrix86 matrix86 said:

gwailo247 said:

228 million? I lose more than that running for the bus.

.....huh? I don't understand what you mean there, but anyway, you have to remember that BB is bankrupt, so they aren't worth very much.

captaincranky captaincranky, TechSpot Addict, said:

I though he meant that that much money bounced out of his pockets while he was running.

Surely he boasts, but don't let him hear you call him "surely".

(That's paraphrased from the, "Naked Gun" movies. I mention it so somebody doesn't consider themselves overly clever by catching me at it).

Omnislip said:

captaincranky said:

I though he meant that that much money bounced out of his pockets while he was running.

Surely he boasts, but don't let him hear you call him "surely".

(That's paraphrased from the, "Naked Gun" movies. I mention it so somebody doesn't consider themselves overly clever by catching me at it).

That's from 'Airplane', no?

captaincranky captaincranky, TechSpot Addict, said:

My bad......

That's from 'Airplane', no?
In hindsight I should have said, "that's a quote from Leslie Nielson". This would have saved me the trouble of trying to remember the scripts to several comedy movies.

As to "Airplane", I mostly remember Lloyd Bridges continual reiteration of, "I picked a bad day to quit...cigarettes, amphetamines....etc...."

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