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Blockbuster Bankruptcy Shoe Finally Drops; Nearly $1 Billion In Debt

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Blockbuster (NYSE: BBI) ended the speculation today, filing for Chapter 11 bankruptcy nearly 25 years after the video rental chain opened its first store. The company said more than 80 percent of its secured creditors have approved a plan to reduce its almost $1 billion in debt to roughly $100 million. The bankruptcy filing shouldn’t affect daily business and doesn’t include Blockbuster’s franchises or non-U.S.operations.

The largest unsecured media creditor is Twentieth Century Fox Home Entertainment; Blockbuster owes the News Corp (NSDQ: NWS). unit $21.6 million. Warner Home Video, $18.9 million, and Sony (NYSE: SNE) Pictures Home Entertainment, $13.3 million, are next.