Blockbuster takeover bid by Dish wins Judge’s OK

By Reuters
Posted April 7 at 3:36 p.m.

Satellite television company Dish Network Corp can go ahead with its $320 million purchase of Blockbuster Inc, a bankruptcy judge ruled on Thursday.

Judge Burton Lifland’s approval gives Dish, led by billionaire Charlie Ergen, control of the one-time video rental leader’s 1,700 stores — new ways to market Dish’s services.

Dish put in the winning bid for Blockbuster at an auction earlier this week at the U.S. bankruptcy court in Manhattan.

The company beat out activist investor Carl Icahn, South Korea’s SK Telecom Co and a group of hedge funds led by Monarch Alternative Capital LP.

Proceeds of the sale will help pay off Blockbuster creditors who are collectively owed more than $1 billion. These creditors include Icahn, other bondholders and movie studios, among others.

Blockbuster’s assets include stores, customer lists and rights to stream movies over the Internet.

Jim Keyes, Blockbuster’s chief executive, said after Thursday’s court hearing that he was pleased with the sale, especially because Dish has said it plans to keep Blockbuster operating.

Speaking to reporters, Keyes declined to say how many stores will remain open but said he expects Dish to assume a significant number of leases.

Other potential buyers included liquidators that were expected to close Blockbuster had they won the auction.

Blockbuster employs roughly 16,500 people in the United States and 12,800 people elsewhere, Keyes said.

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