VIDEO RENTAL MERGER SOUGHT KEY RIVAL SOUGHT BY BLOCKBUSTER.Byline: Greg GREG Great Egg Harbor National Scenic and Recreational River (US National Park Service) Hernandez Staff Writer With the over-the-counter movie-rental business on the decline, Blockbuster block·bust·er n. 1. Something, such as a film or book, that sustains widespread popularity and achieves enormous sales. 2. A high-explosive bomb used for demolition purposes. 3. Inc. wants to buy rival Hollywood Video in a $1 billion transaction that would include $700 million for the chain plus the assumption of $300 million of its debt. The proposal, announced Thursday, would result in a chain of nearly 7,000 stores in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , controlling close to 60 percent of the video-rental market. Blockbuster proposed payment of $11.50 per share in cash, 17 percent over Hollywood's closing price Wednesday and 12 percent more than the value of Hollywood's current merger agreement. The two companies have not yet had any formal discussions about a possible transaction. Hollywood Entertainment Corp. officials were not commenting Thursday. ``I think Blockbuster is sort of throwing it out there to see what Hollywood does,'' said independent media analyst Dennis McAlpine of McAlpine Associates. The proposal comes at a time when the retail DVD DVD: see digital versatile disc. DVD in full digital video disc or digital versatile disc Type of optical disc. The DVD represents the second generation of compact-disc (CD) technology. business has taken a huge bite out Verb 1. bite out - utter; "She bit out a curse" let loose, let out, utter, emit - express audibly; utter sounds (not necessarily words); "She let out a big heavy sigh"; "He uttered strange sounds that nobody could understand" of rentals, with an increasing number of consumers opting to buy a movie at a store or online, rather than rent it and deal with returns and possible late fees. ``We believe this proposed transaction better positions Blockbuster to compete in the rapidly changing home-entertainment marketplace, while simultaneously benefiting consumers, as well as Blockbuster and Hollywood Entertainment shareholders,'' Blockbuster's chairman and chief executive, John Antioco, said in a printed statement. Antioco added that a deal would give Blockbuster more ways to serve more customers by taking advantage of both companies' combined store distribution capabilities and brand portfolios. Blockbuster points to significant competitive threats from discount stores, supermarkets, bookstores, convenience stores The following is a list of convenience stores organized by geographical location. Stores are grouped by the lowest heading that contains all locales in which the brands have significant presence. and online services that often sell DVDs at heavily reduced prices. Chains such as Best Buy, Circuit City and Target often use new releases as loss leaders to increase store traffic. In addition, consumers have more movie-delivery alternatives, including cable, satellite and computer downloading downloading - download . ``It's a typical endgame Endgame blind and chair-bound, Hamm learns that nearly everybody has died; his own parents are dying in separate trash cans. [Anglo-Fr. Drama: Beckett Endgame in Weiss, 143] See : Death for a dying industry,'' McAlpine said. ``As you look at an industry that's starting to go down, you generally see consolidation. The remaining entrants get more and more market share as the industry goes down so they can continue to show growth.'' Shares of both companies closed higher in trading Thursday. Blockbuster rose 11 percent to close at $8.20. Hollywood climbed 11.5 percent, to $10.93. Greg Hernandez, (818) 713-3758 greg.hernandez(at)dailynews.com |
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