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Strategies & Market Trends : Bankruptcy Predictor Model -- Ignore unavailable to you. Want to Upgrade?

To: Razorbak who wrote (129)	3/22/1999 7:20:00 PM
From: Sir Auric Goldfinger	Read Replies (1) \| Respond to of 477

What would have the model said here: "BlowOut Entertainment Files for Bankruptcy Protection (?) BlowOut Entertainment Files for Bankruptcy Protection (Update1) (Adds details on Movie Gallery Inc. in third paragraph and adds to tour.) Wilmington, Delaware, March 22 (Bloomberg) -- BlowOut Entertainment, which operates videocassette rental kiosks in retail chains, filed for bankruptcy court protection from creditors in the wake of a cash crunch and mounting debt, company officials said. The Portland, Oregon-based company listed $18.4 million in assets and $17.2 million in debts in its Chapter 11 petition filed in U.S. Bankruptcy Court in Wilmington, Delaware. It operates 100 kiosks under the BlowOut Video name in Wal-Mart Stores Inc. locations, Kmart Corp. outlets, and grocery stores. BlowOut executives said they've agreed to sell the chain to MGA Inc., whose 900-store Movie Gallery Inc. chain rents videos. BlowOut will be sold for $2.4 million to pay off lenders and other secured creditors in the bankruptcy, they said. ''Based upon preliminary indications, the company believes there will be no assets remaining for distribution to stockholders following the sale and payment to creditors,'' company officials said in an statement. Spun off from videocassette distributor Rentrak Corp. in 1996, BlowOut had a tough time competing in the video rental market, experts said. The company reported a string of losses between 1996 and 1998 and defaulted on several loans. It warned in a 1998 filing with the U.S. Securities & Exchange Commission that it was facing ''severe financial difficulties.'' A cash shortage ultimately forced the company to sell its assets to Dothan, Alabama-based Movie Gallery and file for bankruptcy, officials said in the statement. Movie Gallery is the U.S.'s third-largest video rental chain behind Viacom Inc.'s Blockbuster Video and Hollywood Entertainment Corp.'s Hollywood Video. Among the largest unsecured creditors listed in the bankruptcy filing is Bentonville, Arkansas-based Wal-Mart's leasing unit, which is owed $1.3 million, Rentrak, owed $1.1 million and Seagram Co.'s Universal/MCA studio, owed $196,286. Seagram's is based in Montreal. BlowOut's shares closed unchanged at 1/8 while Rentrak's fell 5/32 to 3 1/4."