Friday May 7 12:13 AM ET
Viacom's Blockbuster Unit Files For IPO
WASHINGTON (Reuters) - Blockbuster Inc., the world's top retailer of movie video rentals and a unit of Viacom Inc. (NYSE:VIA - news), said Thursday it was looking to raise $100 million through an initial public offering of class A common stock.
Blockbuster, with about 6,500 stores in the United States and 26 other countries, did not disclose how many shares it planned to offer, nor did it give an estimated price range for the stock in its preliminary IPO filing with the Securities and Exchange Commission.
Immediately after the offering, Viacom will own none of Blockbuster's outstanding class A stock and 100 percent of its outstanding class B stock, the filing said.
Dallas-based Blockbuster said the class A shares are being offered in the United States, Canada and other countries.
Nearly 60 million people around the world have rented more than 970 million movies and video games from Blockbuster or its franchisees within the last 12 months, the filing said.
For the year ended Dec. 31, the company and its franchisees recorded worldwide revenues of about $4.7 billion -- $3.9 billion from company operations and $800 million from franchised stores -- the company said.
Blockbuster has also experienced significant losses in the last two fiscal years, mainly because of unusual charges taken in 1997 and 1998. Net losses were $318.2 million in 1997 and $336.6 million in 1998, according to the SEC document.
Its IPO is being underwritten by Salomon Smith Barney, Bear Stearns, Credit Suisse First Boston, Goldman Sachs, J.P. Morgan and others, the filing said.
Blockbuster plans to use the proceeds from the offering to repay certain borrowings under a credit agreement. It has applied to trade the shares on the New York Stock Exchange under the symbol .
Viacom is one of the world's largest entertainment companies whose operations include MTV Networks, Paramount Pictures and 19 television stations.
Viacom stock closed 12.5 cents at $41.75 in trading on the New York Stock Exchange. |
