Road to bankruptcy paved with DVDs: Final breath for Redbox
Written by Emily J. Thompson, Senior Investment Analyst
Source: SeekingAlpha
- Bankruptcy Filing: Chicken Soup for the Soul Entertainment (CSSE), parent company of Redbox, files for bankruptcy with debts close to $1B owed to various creditors.
- Historical Parallels: CSSE's situation draws comparisons to Blockbuster's downfall in 2010 due to failing to adapt to industry changes like Netflix and video-on-demand services.
- Acquisition and Debt: CSSE acquired Redbox in 2022, accumulating an additional $325M in debt, led by CEO Bill Rouhana, who has faced criticism from analysts over the years.
- Stock Performance: CSSE shares plummeted by 40% to $0.12 after the bankruptcy news, continuing a downward trend that saw an 83% drop over the past year.
- SPAC Involvement: Redbox Entertainment was part of the SPAC boom, taken public by Apollo Global Management in 2021 before being offloaded to CSSE as the SPAC bubble burst.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
