Redbox is no longer around.
The DVD kiosk rental business will be closed due to a transition of the parent company. Bankruptcy filing Liquidation proceedings under Chapter 7.
Redbox has grown to about 34,000 kiosks across the U.S., many of them in grocery and drug stores. Since its launch in 2002, Redbox has rented 1 billion discs for less than the cost of cable TV, according to the company’s website.
Chicken Soup for the Soul Entertainment, which owns Redbox, is about $1 billion in debt and owes millions more to multiple entertainment companies.
Variety reported that 1,000 of the company’s employees will lose their jobs without severance or long-term benefits.
Chicken Soup for the Soul Entertainment failed to pay employees and vendors for at least four weeks before filing for Chapter 11 bankruptcy protection last month.
The parent company of those distinctive red kiosks found in grocery stores has filed for bankruptcy after enduring months of financial difficulties.
The company said in a filing that it has about $1 billion in debt and owes millions more to entertainment companies including the BBC and Sony Pictures, as well as retailers from Walmart to Walgreens.
The company took on about $325 million in debt after acquiring Redbox from private equity giant Apollo Global Management in 2022, according to filings. The plan was to combine its DVD rental business with a free streaming service like Crackle, the entertainment platform once owned by Sony, into an entertainment conglomerate.
But the plan fell apart when a double Hollywood strike limited the production of new content and a decline in DVD rental users forced rival Netflix to pull out of the business last year.
CSSE declined to comment.
Deadline previously reported that Redbox hasn’t paid employees for a week and has suspended their health care benefits, which could help the company resolve those issues by filing for Chapter 11 bankruptcy protection if a Delaware court approves the company’s plan.
The company’s publishing division, which publishes self-help books that were once a global phenomenon, has not been affected by the entertainment division’s bankruptcy filing.
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