The troubled tale of former movie rental giant Blockbuster has taken a turn for the worse with the company admitting for the first time that a fall into bankruptcy could be inevitable.
So bad are the chain's finances that the Financial Times claims it is having trouble securing the supply of new DVDs from Hollywood studios. It adds that it is even considering offering up its Canadian operations as collateral due to the inability to access bank credit.
Our level of indebtedness may make it more difficult for us to pay our debts as they become due and more necessary for us to divert our cash flow from operations to debt service payments,” a company filing stated.
It added that because of the increasingly competitive industry conditions” there is substantial doubt about our ability to continue as a going concern”.