Blockbuster continues its downward spiral as it has been suspended from trading and forced to delist from the NYSE effective next Wednesday. Currently trading at $0.18 per share, Blockbuster failed to win majority stockholder approval last week for a reverse stock split that would have brought its stock above the $1 threshold and back in compliance with the NYSE. In a move that delays any immediate bankruptcy proceedings, Blockbuster was given a one-month reprieve on debt payments that the movie rental giant failed to pay on July 1st. The creditors, which hold nearly $440 million of Blockbuster’s whopping $920 million of debt, agreed to postpone any “remedies” until August 13th. In the upcoming weeks, Blockbuster is hoping to negotiate with partners to get a quick infusion of cash by possibly converting some bondholders to equity investors. This quick fix may be a little too little, a little too late and may only delay the inevitable bankruptcy as Blockbuster shows no signs of becoming profitable in the foreseeable future.
