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Blockbuster Bankruptcy Auction Underway in New York

by Sean P. Aune | April 4, 2011April 4, 2011 2:00 pm PST

Blockbuster storeThe Blockbuster Video chain is currently on the auction block in New York City, but with the number of bidders and varying styles of offers no one is quite sure when it may end.

As we reported last month, Blockbuster is being forced to throw in the towel and auction itself off to pay its creditors.  The auction is currently going on outside the chambers of Judge Burton Lifland according to The Wall Street Journal, but what is surprising everyone is the variety of offers on the table right now.

According to sources, Carl Icahn, the man who unleashed the DeLorean on the world, has put in his bid, but it is in partnership with a liquidation company.  Apparently his plan calls for the liquidators to close the remaining 1700 retail store fronts while he focuses on the parts of the company that deal with DVD rental kiosks and digital distribution.  With his plan, the brand would remain, but there would be no more of the familiar stores.

Also in the hunt for the chain is Gordon Brothers Group and Hilco Merchant Resources, a pair of well known liquidators.  The real head scratcher is apparently Dish Network has submitted a bid, but no one quite knows what the satellite company’s plans would be for the chain.

Apparently most of the bids involve keeping the kiosk and digital distribution service as ongoing concerns, but with Redbox and Netflix having cornered those markets respectively, it’s unclear just how wise this strategy might be.

It’ll be interesting to see how this plays out, and while most bankruptcy auctions end the day they begin, currently some are saying it may be tomorrow before a bid is accepted.

What do you think?  Should anyone bother to keep any portion of Blockbuster brand going?

[via The Wall Street Journal]

Sean P. Aune

Sean P. Aune has been a professional technology blogger since July 2007, but his love of tech dates back to at least 1976 when his parents bought...