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Legal Daily News Feature

BlockBuster Inc’s legal representation will be Weil, Gotshal & Manges By Todd Schultz BlockBuster Inc., a Dallas-based company, has amassed almost $1 billion worth of debt. However, executives are claiming that after bankruptcy, they will reduce that debt down to a number near $100 million.

10/13/10 The shareholders will be represented by New York attorney, Paul Racmuth. Racmuth confirmed the news on Monday. BlockBuster has obtained a $125 million financing commitment from senior note-holders. The company will use the money to reorganize after the bankruptcy. In a statement released by the shareholders, they say that the manner in which Blockbuster entered bankruptcy was ‘’adversely influenced by the relationship between the largest holder of senior debt, Mr. Carl Icahn, and Blockbuster CEO Jim Keyes.’’


Additionally, the committee of will ask that the bankruptcy court establishes an equity committee that would offer up a valuation of the company in the interest of the shareholders. Talk of a pending bankruptcy plagued Blockbuster ever since the advent of NetFlix in 1999. Those discussions were amped up when grocery and convenience stores began hosting services like Red Box, which offer consumers rentals for as cheap as one dollar a night. Coinciding with the bankruptcy case is the company’s search for a new CEO. However, Jim Keyes will be considered for the position.

BlockBuster Inc's legal representation will be Weil, Gotshal & Manges