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We all knew it was a matter of time before video rental stores became obsolete with the developments of the internet, instant streaming, and mail-order DVDs. The titan of video rental, Blockbuster, announced that they are filing for Chapter 11 bankruptcy. The chain is currently $1 billion in debt, but it says it has a plan for restructuring that includes borrowing an additional $125 million from senior debt holders to complete a reorganization plan that will find ways to make Blockbuster’s 3,000 stores more profitable.  Once Blockbuster completes the restructuring, the company estimates its debt will be less than $100 million of the restructuring loan. Senior debt holders will then own Blockbuster. Blockbuster stockholders and junior debt holders will get nothing in the bankruptcy proceedings. |