% | $
Quotes you view appear here for quick access.

Blockbuster Inc. Message Board

  • karlyhui karlyhui Nov 16, 2005 12:21 PM Flag

    How this new offering works?


    It would be nice if someone explain how this new offering is.

    I would greatly appreciate


    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • are_you_ready_skidaddy are_you_ready_skidaddy Nov 16, 2005 12:27 PM Flag

      The offering gives prefered shareholders more status to any assets of BBI under bankruptcy than common shareholders but less than creditors of BBI. So if you want to asure an ownership in BBI that will last buy BBI debt. Otherwise you run the risk of being wiped out in the bankrupcy if you own the prefered AND you be certainly wiped out if you own the common.

      • 2 Replies to are_you_ready_skidaddy
      • On November 15, 2005, Blockbuster completed the private offering of the Shares at an aggregate offering price of $150,000,000. The aggregate discounts and commissions to the Initial Purchasers was $4,875,000. A copy of the press release announcing the completion of the offering is attached hereto as Exhibit
        99.1. The Initial Purchasers have an over-allotment option to purchase an additional 22,500 Shares. Blockbuster intends to use the net proceeds from the offering for the repayment of a portion of the outstanding borrowings under its revolving credit facility and for general corporate purposes, which may include working capital and capital expenditures.

      • netflix_got_blockbusted netflix_got_blockbusted Nov 16, 2005 12:38 PM Flag

        Ultimately, the people who put up $150MM have far more access into BBI's strategy and finances than we do. And if these people had any fear of BK, they certainly wouldn't put risk their money for 7%.

        While people on the messageboards love to speculate about BK, it's just not a reality.

        At this point, BBI has far better credit terms and much more operating flexibility. Come this May, it's highly likely that Icahn will take over BBI. At that point, you'll likely see BB Online spun off and the stores run purely for cash. Icahn paid $9 for his initial 10% stake, and he obviously continues to see significant potential in BBI's cash generation potential.