Blockbuster To Tender Hollywood Entertainment

DALLAS-Blockbuster Inc. plans to launch an $11.50 per share, cash tender offer to shareholders for Hollywood Entertainment next month in the latest move to acquire its largest competitor. Locally based Blockbuster first announced its intention to acquire Hollywood in a $1-billion deal last month.

Blockbuster, the largest specialty movie-rental chain with 9,000 stores, would also be willing to offer a higher price for Portland, OR-based Hollywood if it receives certain financial information on the retailer. But Hollywood’s board of directors has yet to release those figures, Blockbuster officials say.

If Blockbuster, favored by some analysts to complete the deal, is able to acquire Hollywood, it would add about 2,000 stores to its portfolio. Blockbuster officials have said if they’re able to buy Hollywood, the acquisition would help their company “compete in the rapidly changing home entertainment environment,” but have released few details about their potential plans for the chain. For instance, they have not said whether they intend to change the name of the Hollywood stores and fold them into their current chain.