updated 07:30 am EDT, Wed April 6, 2011
Dish snaps up Blockbuster for 320m
Dish said Wednesday that it had won an auction to buy Blockbuster. The satellite TV provider said it had offered $320 million, about $228 million of which was in cash, to beat out competitors like investor Carl Icahn and SK Telecom. Bids had gotten as high as $310.6 million, from Icahn, before Dish landed the final price.
The victory still required approval at bankruptcy court on Thursday. Any deal if approved should be completed before the end of the spring.
Dish didn't outline its exact plans for Blockbuster but said the struggling video rental chain gave "cross-marketing and service extension opportunities" that would bolster its existing TV service. Earlier speculation had raised the prospects of Dish being sold at remaining Blockbuster stores as well as the chain being used as leverage to score major content deals. The deal also gives Dish control of Blockbuster's Internet video service and puts it into the online arena.
Blockbuster will have managed to command a slight premium over the minimum $290 million bid it set for the auction but is still facing the end to one of the bleaker chapters in its history. The company was effectively destroyed by competition from Netflix, a firm it had the chance to buy in 2000, and has had only limited success in online video. Netflix currently owns 61 percent of online video where smaller, pay-per-title services like iTunes still have significantly larger share than Blockbuster.