Dish Network bids for Blockbuster at the last minute before the bidding deadline.

[TheForce]

Interesting:

BANKRUPTCY WEEK AHEAD: Bidders Line Up To Battle For Blockbuster Assets

By Marie Beaudette and Patrick Fitzgerald
Of DOW JONES DAILY BANKRUPTCY REVIEW

Video-rental chain Blockbuster Inc. (BLOAQ,BLOBQ) will go on the auction block Monday, and several bidders have indicated they'll try to beat out a $290 million stalking-horse offer from a group of hedge funds led by Monarch Alternative Capital.
Initial bids ahead of Monday's auction in the New York bankruptcy court were due Thursday. The Wall Street Journal reported Friday that billionaire investor Carl Icahn and satellite-TV company Dish Network Corp. (DISH) submitted offers before the deadline. An official at South Korea's SK Telecom Co. (SKM, 017670.SE) said the company is also considering a bid.
Blockbuster suitors would have to beat out the $290 million stalking-horse offer from the Monarch-led hedge funds, which hold the company's senior bonds. Icahn, who has played a big role in Blockbuster's restructuring, battled with the bondholder group to serve as the lead bidder for the company's assets.
Blockbuster filed for Chapter 11 protection in September as it lost ground to competitors Netflix Inc. (NFLX) and Coinstar Inc. (CSTR), the owner of Redbox movie vending machines. The company originally planned a standalone restructuring but abandoned that strategy after talks with creditors fell apart.
Jury selection in the criminal trial of Lee Farkas, the founder of Taylor, Bean & Whitaker Mortgage Corp., is set to begin Monday in Alexandria, Va., federal court.
Federal prosecutors claim Farkas, the Florida businessman who built Taylor Bean from a small Florida mortgage company into the nation's largest mortgage lender not owned by a bank, engineered a massive multibillion-dollar bank fraud that brought down the mortgage company and its main lender, Colonial Bank.
He has pleaded not guilty to 16 counts of bank, wire and securities fraud. If convicted, he could spend the rest of his life in prison.
In recent weeks, a number of defendants--Taylor Bean's former president and treasurer as well as the former head of Colonial Bank's mortgage warehouse lending division--have pleaded guilty to criminal charges connected to the scheme. Colonial, an Alabama bank that collapsed in 2009, was Taylor Bean's main lender and provided the company with $3 billion in mortgage financing.
Taylor Bean filed for bankruptcy protection in August 2009 after federal regulators froze its accounts and suspended its authority to make loans insured by the government agencies. The company was forced to shut its doors after federal regulators and the Federal Bureau of Investigations raided its Ocala, Fla., offices at a time of reports that the company's accounting firm halted an audit after uncovering evidence of massive fraud.
On Thursday, New York's St. Vincent's Hospital will seek to sell its Manhattan campus to a company controlled by members of the Rudin family for $260 million.
The deal would bring back emergency medical services to the area, which have been lacking since St. Vincent's shut down last year. The Rudin family, one of New York's prominent real-estate investors, would redevelop the remaining portion of the site.
North Shore-Long Island Jewish Health Care System has agreed to take over the former hospital's O'Toole Building and invest $110 million to create a health-care center that will include a free-standing emergency department.
Rudin would renovate four historic St. Vincent's buildings into apartments and would build new tower and brownstones elsewhere on the campus.
The deal, however, is facing opposition from a group, which counts among its members former New York City Council member Alan J. Gerson, that claims it's working on a deal to bring a full-service hospital to the site.
St. Vincent's, founded more than 160 years ago, filed for bankruptcy last year after failing to find a buyer to take over its operations.

 

[lakebum431]

Very interesting indeed. Here's to hoping that they close the doors of all of the B&M stores and integrate the service into Dish.

 

[dlsnyder]

What would they do with Blockbuster? I can't see them operating what amounts to a less expensive competitor to their satellite business. They could close all the B&M locations and continue the kiosks and mail distribution services, but they would still be competing with Redbox, Netflix, and themselves. Perhaps it is an admission that cord-cutting is real, and they are trying to broaden their offerings before their satellite business starts to permanently erode.

 

[CK SatGuy]

I think they would close the remaining stores and create an online streaming service for Dish Customers only. Although as I'm writing this, it wouldn't make sense since they already have Dishonline.com

 

[lakebum431]

I think they would close the remaining stores and create an online streaming service for Dish Customers only. Although as I'm writing this, it wouldn't make sense since they already have Dishonline.com

But how many people have heard of dishonline.com as opposed to blockbuster? I can see paying for the name. At that price, I don't know, unless they can get the agreements to show movies without the 30 day lag that Netflix has right now along with the name.

 

[mike123abc]

Blockbuster may also have licenses from content providers that Dish lacks, plus perhaps a distribution system.

 

[DishSubLA]

We don't know how much it is costing Dish to provide the content on it's DishOnline service, as it really seems from a 3rd party. It may be cheaper in the long run to bid for Blockbuster for its streaming service that Dish will own and have the Blockbuster name. Also, as mentioned, blockbuster seems to have more licenses for more TV series than found on DishOnline. I can't see Ergan wanting any of their stores. I think this is all about the streaming content, and Dish desperately need to be far more competitive on that front.

 

[dfergie]

"Dish presents Blockbuster movies" does have a ring to it...

 

[TheForce]

I think Charlie sees the writing on the wall for satellite TV. All satellite service business model is quite costly to deliver the content. In the case of the online distribution, they just need the licenses and customers. Blockbuster (online service has that. I don't see DishNetwork keeping the B&M stores but I do see Charlie seeing a quick and easy way to acquire a bunch of customers for an online service. Satellite TV companies need to evolve to stay profitable. With broadband becoming ubiquitous in the next few years, who will sub to Dish at $120 per month when they can get their content for under $20 a month. a la Netflix, Hulu and other PPV services.

 

[jimdandyvi]

The studios that licensed their content to Netflix for on line streaming failed to anticipate how quickly the demand for streaming video would grow and how quickly the sale/rental of DVDs would fall.

When they renegotiate the contracts you can be sure they will want more money making impossible for Netflix to continue offering unlimited downloads for a low fixed price.

Content owners have all the leverage. If Netflix and its customers won't pay what the studios want then there is nothing stopping them from setting up their own streaming services.

Jim

 

[Juan]

they won...Dish Network wins Blockbuster bankruptcy auction | Reuters

 

[skyviewmark]

This is very interesting.. I think all the Blockbuster stores here in Southwest Alabama have been closed for a long time. This has to be about the streaming capability..

After checking I see there are 2 stores within 22 miles of me still open.. Guess that means new Dish Stores helping put more nails in the coffin of the retailer.

 

[llzel]

dish is nuttier than I thought

 

[fbara]

I thin someone posted earlier that really wants the agreements Blockbuster has with the major studios. With that in place, Dish could really beef up it's VOD offering as well as use BB's network of movie distribution. I would bet that's What Charlie is really after.

 

[Hemi 6.1]

How much you want to bet it won't offer much free VOD.

 

[Roxor]

Hey, I hear there is a buggy whip company for sale. Maybe Charlie can throw away several millions of our dollars on that too.

 

[Scott Greczkowski]

DISH Network Agrees to Acquire Blockbuster Assets

ENGLEWOOD, Colo., April 6, 2011 /PRNewswire/ -- DISH Network Corporation (NASDAQ: DISH) announced that it was selected as the winning bidder in the bankruptcy court auction for substantially all of the assets of Blockbuster, Inc. DISH Network's winning bid was valued at approximately $320 million. After certain adjustments are made at closing of the transaction, including adjustments for available cash and inventory, DISH Network expects to pay approximately $228 million in cash to acquire Blockbuster at the closing which is expected to occur in the second quarter of 2011.

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

Completion of the transaction is contingent upon satisfaction of certain conditions, including bankruptcy court approval.

Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995:

Except for historical information contained herein, the matters set forth in this press release are forward-looking statements. The forward-looking statements set forth above involve a number of risks and uncertainties that could cause actual results to differ materially from any such statement, including the risks and uncertainties discussed in DISH Network Corporation's Disclosure Regarding Forward-Looking Statements included in its recent filings with the Securities and Exchange Commission, including its annual report on Form 10-K. The forward-looking statements speak only as of the date made, and DISH Network Corporation expressly disclaims any obligation to update these forward-looking statements.

 

[grydlok]

for 1/3 of that price he could have negotiated that without buying Blockbuster

 

[Scott Greczkowski]

How do you figure that when it was an auction?

 

[Hall]

They could close all the B&M locations and continue the kiosks...

Blockbuster doesn't operate any kiosks. Those are fully-owned by NCR - NCR simply licensed the Blockbuster name. Think about it, who would people want to rent movies from, NCR or Blockbuster ?

As for closing all remaining stores, personally I think that some B&M stores can and should remain. Fact is, BB has or had way too many. At one time, within a 10-min (city) drive of my home, I could get to 9-10 BB stores !! A large number of people still want to walk in and rent a disc. Not everyone is interested in streaming or ordering a movie and waiting 1-2 days for the disc to arrive.