Television

Viacom close to spinning off video rental chain Blockbuster

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MUMBAI: Having failed to find a buyer for its Blockbuster video-rental business media conglomerate Viacom is said to be nearing a decision to spin it off.

Viacom has been trying to find a buyer for Blockbuster since last year. The home video market is rapidly losing favour among the movie viewers as the cost of DVDs are coming down and cable ops are coming with attractive video on demand offerings in the US.

Viacom has an 82 per cent stake and reports indicate that it would not be in the best interests of the company to try selling it to the public as newly issued Blockbuster shares because there would be scant demand for the stock. A final decision is expected within the next fortnight.

Blockbuster is also facing insurmountable problems in China. Therefore the Dallas based company has decided to withdraw from Hong Kong and close its 24 stores in the city within the next 18 months as their leases expire. The company found the store lease costs to be very high.

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