April 14, 2008 by Arlen Schweiger
Welcome to Blockbuster City? Well, maybe not yet, but Blockbuster’s interest in taking over Circuit City is heightening.
The company disclosed a takeover bid to Circuit City shareholders on Monday, with an unsolicited offer worth more than $1 billion. Blockbuster is apparently going straight to the shareholders after previous offers have been met with no response, according to an Associated Press report.
Two months ago, Blockbuster sent a letter to Circuit City chairman and chief executive Philip Schoonover offering $6 to $8 per share in cash for the clumping electronics retailer, which turned a profit in its fourth quarter of the last fiscal year thanks in part to cost-cutting measures that have included more than 3,000 layoffs over the last year.
Blockbuster said it had sought a response by Feb. 21 to its offer, but did not receive the detailed info it wanted from Circuit City for a formal takeover bid.
Blockbuster has already showed some forward thinking recently by siding with Blu-ray about eight months before other major names did , and apparently readying for a set-top box to stream movies.
This move will certainly be interesting to keep an eye on, especially if it actually happens, to see what effects it might have on both camps.
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Arlen writes about home technology installations and product news and reviews for electronichouse.com
and Electronic House magazine.
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