Unedited press release follows:
Receiver seeking order to wind down Blockbuster Canada Co.’s operations
TORONTO, Aug. 31, 2011 – The Receiver of Blockbuster Canada Co. is seeking an Order of the Ontario Superior Court of Justice to close Blockbuster Canada Co’s remaining retail locations and to wind down the Company’s operations.
As a result of the significant changes in Blockbuster Canada Co.’s competitive landscape, the Company’s “bricks and mortar” business model has experienced significant challenges over the last few years, largely due to the proliferation of various alternatives available to media consumers in Canada.
Blockbuster Canada Co.’s operations were consolidated by the Receiver early in the receivership as authorized by the Court. Approximately 150 of the Company’s underperforming retail locations were closed in June, 2011 and the Company’s 253 remaining stores continued to operate.
The Receiver conducted an extensive Court-approved sale process aimed at identifying a suitable purchaser of Blockbuster Canada Co.’s remaining business and operations on a going-concern basis. Ultimately an agreement with a suitable purchaser willing to make the necessary investments in the business as a going-concern could not be reached. Accordingly, the Receiver has recommended to the Court that it be authorized to, among other things, conduct an orderly wind-down of the Company’s operations. If approved by the Court, the store closing process would commence within a few days and the Company will cease accepting Blockbuster Canada Co. Gift Cards and loyalty/rewards programs as of the commencement of the store closure process. The hearing to consider these issues is scheduled for September 6, 2011.
“We appreciate the ongoing support and wish to thank Blockbuster Canada Co.’s employees, customers, suppliers and other stakeholders during this difficult period,” said Michael Creber on behalf of Grant Thornton Limited.
US-based Blockbuster L.L.C. (“New Blockbuster”) purchased the assets of Blockbuster Canada Co.’s US parent company from US bankruptcy in April, 2011 and continues to operate 1,500 blockbuster stores in the US. Those stores will remain open and are unaffected by the Canadian receivership proceedings and store closings. New Blockbuster plans to begin offering Canadian customers exciting new ways to access movies and games before year end.
Information related to Blockbuster Canada’s receivership proceedings can be accessed at: www.grantthornton.ca/blockbuster.