Another big name retailer falls.
On Monday, word got out that UK music retailer HMV had entered administration. Now, it seems another big name retailer is following in HMV's footsteps in the UK. Reuters reports that Deloitte has been appointed as an administrator. Deloitte said Wednesday that Blockbuster's stores would operate as normal while it tries to find a buyer for the company.
Thanks to digital distribution platforms, DVD rental companies like Blockbuster have had a hard time over the last five years. However, the last couple of years have been big ones for the video entertainment industry in the UK. Last year, streaming giant Netflix entered the UK market, which was already populated by a number of sizable players including Amazon's LoveFilm, 4oD, and BBC's iPlayer. Indeed, the allure of renting or streaming digital content as opposed to schlepping down to the shops is hard to resist.
Blockbuster officially filed for bankruptcy in the United States in September of 2010. The company submitted a filing for Chapter 11 bankruptcy, requesting protection against its almost $1 billion worth of debt while it tried to figure out a restructuring solution. In April of 2011, the company’s assets were purchased by Dish Network in a $320 million bankruptcy court auction. After adjustments for available cash and inventory, the price Dish paid ended up being around $228 million.
Blockbuster employs more than 4,000 people in the UK across 528 stores.