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  • paragondefect paragondefect Jun 22, 2011 10:59 AM Flag

    2012 Bonds, Dish, New Tread

    To continue the discussion of both dstrouss and nuljava75 about the current status of the 2012 Bonds and the mystery surrounding them, I decided to start a new thread.

    First off, E-Trade is still showing “Blockbuster Inc Sr Sb Nt 9%12” so nothing new there. I did request an order quote for 100 bonds ($100,000 face) and out of 9 passes only one offer came back at .40. So $100K of Bonds can be purchased for $500 including commission. Not sure if they could have filled anything bigger but I suspect not.

    Like most of you, I’m pretty surprised that Cooley and the UCC didn’t make a peep after the auction. Cooley did submit several million dollars of billable hours a couple months ago but from what I can determine, they didn’t do ANYTHING for any of the parties they were representing. Studios are now forced to go after Canadian assets, Preferred get nothing, and 2012 Bonds appear as if they are worthless. What did Cooley actually do?? Anything? I know several people contacted them after the auction and the Cooley response was pretty combative and downright rude. I personally contacted Cooley back in December for an update and they had some junior flunky contact me and spew out some gloom and doom scenario that was obviously spoon fed to all of the associates. When I began to ask him some direct questions about what they were doing, he claimed they couldn’t discuss anything. When it came out that he didn’t even know who Greg Meyer was, I realized that Cooley wasn’t up to speed on what had been happing the past year and weren’t at all interested in digging too deep to find anything. Their actions up to and after the auction have proven this.

    So, why would this be? Why wouldn’t they do anything after the auction to try to get some recovery for those they are representing? Doesn’t make sense unless there was some deal agreed on that hasn’t been made public yet. Sure is suspicious…..

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    • I have wondered why Blockbuster would give up revenue last year and all the hollywood orphans by making the large store base competitive and also burned cash on a failed attempt to recap and the costs of bankruptcy.

      I talked to a broker in New York who told me there was no problem for Blockbuster to get the cash they needed at a good interest rate and the fact is well known.

      So lowering interst was very possible and should have made a recapitalization possible. In spite of all this they closed a large portion of the only source of large revenue. Crazy!

      I talked to another rather long term watcher of the stuation who believes the studios are behind the whole thing and have been since 2007 when they made Sonic and Blockbuster the Kings of VOD.

      He may be right too, as nobody that has tried to get a foot hold in VOD has done anything with it besides Bockbuster who has all those apps on the android phones, not to mention a partnership with every cellular operator that is large. How many Smart phones have a Best Buy Application for Cinema Now. No sireee, not one and yet Bankrupt old BB has them everywhere.

      Could the studios want to push people to VOD by closing BB stores. It seems stupid to think that, because the studios make good money from physical media. But if you read the transcript of the March 10th court hearing, you get the sense that there is something going on between BB and the studios. But this Dish thing is about VOD. And then there is the NOLs which are usable as soon as these assets atart making money.

      My guess is that both the secured and the subordinated debt have agreed to a payout at some price or equity position and Icahn has a blocking interest in the secured portion or both and will get his equity both from these shares and his debt and the profits show up at some point and the NOLs get used. Movies have a lot of money in them if anything in society does. Everyone watches movies, they sell in any economy, and there should be profit for anyone in the supply process, but the studios deserve to make money. They produce the product everyone wants.

    • pfvh Jun 22, 2011 3:57 PM Flag

      The only question I have, Bill, is what motivation Dish has to do things this way? What I mean is, if they're going to pay-off the 2012's, then why not just reach a settlement with the creditors and buy-out the shares to begin with. Why bother with the auction and a faux purchase price if that's not really what it is?

    • Thanks, Nuljava! I sure can use some NOLs:)

    • you should move on this matter. because if the stock was declared void/null, i believe you would have to claim the loss for the particular year during the null/void declaration, unless it is still trading somewhere. did you check all OTC markets & penny bulletin boards?

      if its years later, it can be complicated. you could file an amended return possibly, but if too much time has passed it probably could be more complex.

      and remember the maximum capital loss you can declare in any tax year is three thousand dollars. anything above that is carried year after year.

    • This reminds me of a biotech stock that I once owned. While waiting for FDA's decision, someone posted an article (published in previous year) that gave a positive spin on the new drug. Pps spiked. Tens of millions of shares traded. Days later, the drug was rejected. Today the stock has completely disappeared from the earth. And since I was too slow to get out, I still need to find out how to claim that giant capital loss (my e*trade account doesn't even show that I owned the stock).

      So, if big boys wanted to get out of Blockbuster stock, you should have seen much higher pps by now. The fact that it's so low actually makes me feel better.

    • this thread is hilarious...
      its a mind game? how bout numbers game? I really doubt mgmt was intentionally racking up loses. This one is clearly unsustainable

    • It has nothing to do with that. It's all a mind game at this point until the real news comes out. It's easy to get daytraders to sell when you can make the PPS dive. Only the true longs will stay in this game.

    • Dire,
      Sometimes you have to read between the lines or what is not said is more important than what is being said.I can understand some shareholders being jittery.On the eve of a motion by the U.S. Trustee to shove the company into Chapter 7(it is in their interest to kill those NOLs),there is no sign of the company objecting to the motion!

    • are you drunk on the loco juice show proof that the nols are worth 1.5 billion court docs state otherwise. why do you make things up? why didnt your guru give to the lawyer fund? why do you invest in a company with one employee and 1.6 billion in debt? why oh why?

    • Paragon: I suspect that a deal was done pre auction to have the debt exchanged for equity. It looks to me that the powers to me wanted to make these bonds look as worthless as possible in order to keep the control in the hands of a few powerful people. If bonds are still available, I would consider buying some more.