An Odd Mating Dance
The dance has begun. The first moves are subtle. One partner dances slowly around the other, the other shows a vulnerable side. Certain moves are expected, others a surprise. In the world of corporate takeovers, actions speak volumes when it comes to foreshadowing what steps are coming up next.
In a telling move, Circuit City has opened their books to Carl Icahn, the largest shareholder in Blockbuster Video. Icahn has stated that he'll buy up Circuit City himself if Blockbuster can't secure its own financing. And to think, most consumers can't afford a Blu-ray player, and this guy's buying the entire corporation. The partnership makes sense: buy your home theater or gaming equipment, and then a few feet away, pick up new movies and games to use, all in one step. More financial posturings if you continue reading.
A previous bid from Blockbuster was for over $1 billion, but at that time, Circuit City rebuffed the advances. A merger could boost Blockbuster stocks to $11. As of May 13, stocks for Blockbuster were under $3. The question on Wall Street could be even more complex. Is this just an attempt to find a new business model if Netflix pushes Blockbuster off the dance floor?-Leslie Shapiro