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An Example of Deworsification: Blockbuster Buying Circuit City
By JLP | April 23, 2008
Okay, maybe the management at Blockbuster (BBI) knows something I don’t know but, I can’t understand why they would want to buy Circuit City. The article states that Blockbuster sees it as a strategic combination of retailers.
Circuit City has been struggling and Blockbuster is just now making headway on a turnaround. Call me crazy, but I don’t see this as a smart move.
Topics: Business News | 9 Comments »
April 23rd, 2008 at 1:30 pm
@crazy (I couldn’t resist):
So now they rent movies, sell movies, and sell all the electronics that go along with enjoying movies. I wonder if you can rent big screen TV’s now without returning them and, for your convenience, they will charge your card the $1799 + taxes and fees.
April 23rd, 2008 at 2:05 pm
I think that they think….2 negatives make a positive……
April 23rd, 2008 at 2:06 pm
Toni,
That’s awesome!
April 23rd, 2008 at 3:10 pm
Sounds like our old joke about Unisys, which was the merger of Sperry and Univac, which used the “power of two” tagline.
We always called it “the square root of two”…
April 23rd, 2008 at 3:14 pm
Foobarista,
Was that Sperry the shoe manufacturer?
April 23rd, 2008 at 3:34 pm
It’s a matter of convenience, instead of having to hate on two companies, now we can consolidate to just one?
Investors too will appreciate the convinience of one company loosing their hard earned cash instead of two. It’ll save a fortune in transaction fees and market research.
Maybe for your next post, you can request everyone’s favorite Blockbuster/Circuit City story.
April 23rd, 2008 at 5:12 pm
Reminds me of what the ever-brilliant Fake Steve Jobs said in regard to the merger between Alcatel and Lucent: “Two boat anchors trying to teach each other to swim.”
April 23rd, 2008 at 6:59 pm
Toni – love it.
Out of curiosity I just looked at Blockbuster yahoo message board on Yahoo finance. There is a suggestion that BBI buys Mac Donald. It’d be like buying stocks on margin as BBI doesn’t have the money, but at least BBI could resell it and (maybe) make a profit. Maybe this is what BBI wants to do to Circuit City? Buy it low and sell it high? What is the breakup value of Circuit City? If it is greater than what BBI is offering, BBI could make money by just selling assets.
At any rate, it is questionable if BBI would raise enough money, so we’ll never find out how it’d work.
April 23rd, 2008 at 8:42 pm
No, Sperry was one of the ancient computer companies. Univac was another, from the days when there was IBM and a bunch of small fry.
I’ve never heard of a shoe company names Sperry.