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Disney Opposes Blockbuster Bid

NEW YORK ( TheStreet) -- Walt Disney (DIS - Get Report) is opposing the $290 million proposed buyout of Blockbuster (BLOAQ.PK).

Blockbuster received an initial "stalking horse" bid in February from Cobalt Video Holdco, a limited liability company formed by funds managed by Monarch Alternative Capital, Owl Creek Asset Management, Stonehill Capital Management and Värde Partners.

Disney said in a filing that the bid favors the secured lenders over Blockbuster's other creditors. Disney has a $9.2 million claim for merchandise shipping to the bankrupt movie chain. Disney objects "to the secured lender apparently having dictated sale terms beneficial to itself and detrimental to the debtors' estates and its administrative trade creditors."

Other creditors objecting to the bid include Yahoo (YHOO - Get Report), Universal Studios, the U.S. Trustees office and a bevy of landlords and unsecured creditors.

Blockbuster is seeking approval for the stalking horse bid on March 2.

Separately, Blockbuster disclosed a list of potential bidders in court documents that include Amazon (AMZN), Best Buy (BBY), and NCR (NCR), the operator of its Blockbuster Express kiosks.

Blockbuster said this list does not mean any of the potential buyers will attempt to buy the company or that a deal is imminent.

--Written by Jeanine Poggi in New York.

>To contact the writer of this article, click here: Jeanine Poggi.

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