Blockbuster in danger of busting
Yesterday, Blockbuster disclosed that it might not be able to stay in business. This comes only a week after the company revealed that it had a recently-amended $250 million revolving loan that matures in September of next year. The loan relies on certain criteria to be met, and if Blockbuster cannot meet that criteria, it won't get the funding.
According to a recent Associated Press report, Blockbuster has said that, even with the loan, it “may not have sufficient liquidity to finance the ongoing obligations of our business, which raises substantial doubt about our ability to continue as a going concern.”
While this news might not be a major concern to the millions of movie watchers who have embraced services like Netflix and the various available Video-On-Demand libraries, this is still quite jarring. Blockbuster remains the nation's largest video rental chain, and revelations of its uncertain future come less than two weeks after it announced a partnership with TiVo.
Blockbuster believes it will be able to determine whether it can fulfill the loan's requirements by mid-May. In other news, Netflix has just shipped its 2 billionth disc.
— Will Greenwald