Blockbuster Inc. has offered $700 million for rival Hollywood Entertainment Corp. in a deal that would extend Blockbuster's position as the world's largest movie rental company.

Blockbuster Inc. has offered $700 million for rival Hollywood Entertainment Corp. in a deal that would extend Blockbuster's position as the world's largest movie rental company.

Blockbuster said in a news release today (Nov. 11) it has "expressed an interest" in acquiring Hollywood Entertainment for $11.50 per share, a 17% premium over Hollywood Entertainment's closing price of $9.80 yesterday..

In addition, Dallas-based Blockbuster would assume about $300 million in Wilsonville, Ore.-based Hollywood Entertainment debt in the deal.

Blockbuster said that while it has communicated its interest to Hollywood Entertainment, there hasn't yet been a substantive discussion on the terms.

"We believe this proposed transaction better positions Blockbuster to compete in the rapidly changing home-entertainment marketplace, while simultaneously benefiting consumers as well as Blockbuster and Hollywood Entertainment shareholders," said John Antioco, Blockbuster chairman/CEO.

Hollywood Entertainment owns and operates more than 1,920 Hollywood Video superstores and 600 Game Crazy specialty stores. Blockbuster has about 9,000 stores worldwide.


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