Closely following CEO Jim Keyes’ contract extension, Blockbuster Video has appointed a chief restructuring officer to help guide it through the treacherous financial straits in which it finds itself. As part of the forbearance BB recently received from its bondholders over its inability to make a $42 million debt payment, the company was required to name a CRO and provide regular updates to its creditors.
The new CRO, Jeffrey Stegenga, is a managing director with turnaround and restructuring firm Alvarez & Marsal, and will return to his duties with his firm following his tenure with Blockbuster. According to his bio on the Alvarez & Marshal website, Stegenga “is nationally regarded as a specialist in out-of-court restructuring, bankruptcy consulting and financial and accounting consulting.”
Stegenga definitely has his work cut out for him. Can adding a new acronym to its executive team bring Blockbuster back from the brink? What restructuring initiatives do you think that Stegenga will initiate during his time at BB? Leave your opinion in the comments.
(via the Wall Street Journal)
I still think some kind of pre-packaged Chapter 11 filing is possible if the creditors feel that there’s enough equity to salvage in BB as a going concern. Otherwise it’s liquidation city, I’m afraid.
Yeah, it is likely they will try to survive through bankruptcy protection.
This new CRO better be a Houdini for Blockbuster sake.
There’s an interesting discussion going on amongst BBI’s dissident shareholders here:
http://www.blockbustershareholders.com/