Redbox gobbles up Blockbuster Express kiosks for $100 million

Feb 7, 2012
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Redbox gobbles up Blockbuster Express kiosks for $100 million

It looks like the end is near for Blockbuster, the company is shutting down even more of its retail locations that aren't making money and now there will be even less Blockbuster exposure around the country. Redbox has agreed to purchase the Blockbuster Express kiosks that NCR operates around the country. NCR picked up those kiosks after Blockbuster filed bankruptcy. The purchase will land Redbox 10,000 more kiosk locations.

The deal will cost $100 million and will take the kiosk operations away from NCR, more known for ATMs at banks than movie rentals. NCR had previously posted $13 million operating loss, but it's not clear if that was directly related to losses on its movie rental kiosks or not. The transaction is expected to close in Q3 of 2012.

This has some interesting ramifications in the movie rental industry. Redbox recently refused to sign an agreement with Warner Bros. that would have delayed the rental titles coming to the kiosk locations by 56 days rather than the current 28 days. By refusing to sign the agreement, Redbox will be forced to spend more to purchase the DVDs it places in its kiosks, but it will not have to hold to any delay in offering titles for rent.

"The acquisition includes the purchase of the DVD kiosks, certain retailer contracts, and DVD inventory," Redbox said in a statement. "In connection with the asset purchase, Coinstar and NCR also will enter into a strategic supplier arrangement where Coinstar will purchase product and services from NCR."

[via CNET]


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