Blockbuster Goes After Circuit City |
| TheStreet.com - Apr 14, 2008 |
Movie renter Blockbuster (BBI - Cramer's Take - Stockpickr) has offered to acquire consumer-electronics seller Circuit City (CC - Cramer's Take - Stockpickr) for at least $6 a share, but thus far the target company hasn't shown much interest.
Blockbuster said it detailed the proposal in a letter to Circuit City Chairman and Chief Executive Philip Schoonover on Feb. 17. To this point, Circuit City "has failed to provide due diligence necessary to allow Blockbuster to make a definitive proposal," Blockbuster said.
Therefore, Blockbuster decided to make its offer, which could go as high as $8 a share, known to the public. Shares of Circuit City were surging 56% to $6.09. Blockbuster was sinking nearly 14% to $2.70.
Blockbuster's offer comes as both it and Circuit City are struggling to keep up with increasingly tough competition. Blockbuster now offers a movies-by-mail option, along with its traditional stores, in order to offset the impact of Netflix (NFLX - Cramer's Take - Stockpickr), while Circuit City has seen Best Buy (BBY - Cramer's Take - Stockpickr) emerge as the option of choice for consumer electronics.
Read Full Article from TheStreet.com
- Posted: 2008-04-14 08:44:41
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