BLOCKBUSTER (BBI) - GIANT video specialty chain Message Board

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Non-Tech : BLOCKBUSTER (BBI) - GIANT video specialty chain

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To: BIGFRED who wrote (49)	11/9/1999 2:09:00 AM
From: Walter Morton	Read Replies (1) of 67

There is no guarantee that existing shareholders of Blockbuster will get shares in such an IPO [Blockbuster.com]. What's your take on the AOL deal with Blockbuster? Reply: Blockbuster Inc (NYSE:BBI - news). went public and has had a lackluster performance -- until the AOL deal this week. In the deal, AOL will invest $30 million in the Web site Blockbuster.com. In exchange, AOL gets access to the extensive customer database (65 million in all), as well as access to the library of home videos and entertainment information. Moreover, AOL CD-ROMS will be distributed in the 4,000 Blockbuster retail outlets. The deal is very savvy and will definitely inject some energy in Blockbuster. However, the fact remains that most of the company is still heavily brick-and-mortar. For example, in its latest quarterly report, the company posted $1 billion in revenues. So, I think the impact on the parent company will be limited. Instead, the high-rates of return will be concentrated in Blockbuster.com, which will likely be spun-off as an IPO. What's more, there is no guarantee that existing shareholders of Blockbuster will get shares in such an IPO. dailynews.yahoo.com

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