Former Blockbuster rival Redbox goes bankrupt
The company owes more than 500 creditors millions of dollars.
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The company owes more than 500 creditors millions of dollars.
The movie rental service Redbox - identified by its large, red kiosks outside of grocery and convenience stores - has gone bankrupt and will shut down all 27,000 of its movie rental kiosks. The company's 1,033 employees will be terminated without pay as a result, the Daily Mail reported.
In June, Chicken Soup for the Soul Entertainment, the parent company, filed for Chapter 11 bankruptcy to refinance nearly $1 billion in debt. On Wednesday, however, a court heard that lenders were unwilling to provide additional funding, and as a result, the company is in the process of closing under a Chapter 7 bankruptcy.
The company owes more than 500 creditors millions of dollars, including big-name retailers like Walmart and Walgreens as well as industry powerhouses like Warner Bros., Sony Pictures, and the BBC.
Redbox, established in 2002 during the height of the DVD industry, boasted 43,000 kiosks across the US and Canada and generated $1.97 billion in sales annually at its peak in 2013. It was bought by the firm in 2022. The company going bankrupt chalks up another win for large streaming services that have grown to dominate the entertainment industry, such as Netflix, Hulu, Amazon Prime, and Apple TV.
According to filings, CCSE acquired Redbox from Apollo Global Management, a private equity firm, for approximately $325 million in debt. The move was intended to convert the acquisition into an entertainment conglomerate, but the plan did not pan out.
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