Blockbuster Strikes Deal With Studios
NEW YORK (
) --
Blockbuster
(BBI) - Get Report
is surging after it announced a deal with movie studios that will give it quicker access to new movie releases for cheaper prices.
Blockbuster agreed to new terms with Twentieth Century Fox and
Sony's
(SNE) - Get Report
movie studios, where they will deliver new movies to Blockbuster the same day they ship to traditional stores and by mail service. Blockbuster already has a similar deal with
Time Warner's
(TWX)
Warner Home Video.
>> Who Owns Blockbuster?: Carl Icahn
|
Blockbuster also negotiated "enhanced payment terms" in return for a first lien on the assets of Blockbuster Canada. This means the studios will have first priority on those assets in case of bankruptcy.
This news comes as Blockbuster struggles to stay afloat. In March, the company said it may be forced to file for bankruptcy if cash levels don't improve. Blockbuster currently has more than $1 billion in debt and is in the process of attempting to re-negotiate its debt.
Shares of Blockbuster are soaring 15.9% to 29 cents in morning trading.
-- Reported by Jeanine Poggi in New York.
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