Dish Network has ponied up $320 million to acquire bankrupt Blockbuster Video, winning the company at auction against billionaire Carl Ichan and two other bidders, the company said.
The satellite television provider said it expects to pay about $228 million after adjustments for available cash and inventory are made at the close of the transaction. The deal is expected to close in the second quarter.
"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 Executive Vice President of Sales, Marketing and Programming for DISH Network Tom Cullen. "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."
Blockbuster once was the largest brick-and-mortar DVD and game rental company in the world with a market cap of some $5 billion in 2002, but saw its business fall apart as competitors, especially Netflix, made it easier-and cheaper-to rent movies. It made an abortive attempt to recreate itself with a streaming product that hit the market far too late. It filed for bankruptcy in September and in February went up for sale when it couldn't come up with a solid reorganization plan.
Blockbuster isn't the first troubled company Dish has acquired of late. In March, it acquired DBSD North America, a hybrid satellite and land-based company for $1.4 billion.
- see this release
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