Blockbuster Inc. has offered to acquire Circuit City Stores, Inc. for at least $6.00 per share in cash, subject to due diligence. The offer was made in a letter sent to Circuit City Chairman and Chief Executive Officer Philip Schoonover on February 17th on behalf of the Blockbuster Board of Directors, which fully supports the offer. To date however, Circuit City has failed to provide due diligence necessary to allow Blockbuster to make a definitive proposal. Blockbuster is making its proposal public because it believes the shareholders of Circuit City should have the opportunity to participate in determining the destiny of the company. In addition, as Blockbuster has other strategic opportunities, its offer is conditioned upon timely commencement of the due diligence process.
Blockbuster noted the combination of the two companies would result in an $18 billion global retail enterprise uniquely positioned to capitalize on the growing convergence of media content and electronic devices. The transaction would allow both companies to benefit from the revenue growth generated by their complementary products, while the resulting synergies would substantially improve consolidated financial performance, thereby increasing shareholder value.