NEW YORK ( TheStreet) -- The long-awaited Blockbuster (BLOKA.PK) bankruptcy filing came in the wee hours this morning. For the company, the Ch.11 restructuring will allow them to cut debt by nearly $900 million while continuing to operate stores and kiosks.
For shareholders and investors holding subordinate debt, who stuck by the company through the past year of bankruptcy scares and ongoing discussions, well they are out of luck.
Shareholders have complained they have been left in the dark throughout this process, and have set up a forum, BlockbusterShareholder.com, to vent these frustrations.
One shareholder, Niko Celentano, sent a letter to CEO Jim Keyes last month, after reports surfaced that a bankruptcy filing was imminent. In the letter he said "With the news out now that Blockbuster is looking to file a bankruptcy, you have left us no choice but to prepare our legal representation should this occur and we as shareholders, not be included in any settlements. Please understand this loyal group of shareholders has stuck with the company through this tough time and fully expect to be part of the turnaround that is ahead."