NEW YORK (TheStreet) -- Blockbuster is clearly still a hot topic among investors, even though the company has been under Dish Network's (DISH_) banner for nearly six months.
Following Thursday's temporary suspension of trading of Blockbuster pink sheets by the Securities and Exchange Commission, shareholders had plenty to say. It has also led to many questions by shareholders who are now at a loss as to what's next.
Vincent Crowley asks: "Thank you for this article, but can you elaborate on this? Are there no operations/sales/business behind BLOAQ any longer? e.g., Does all of the Blockbuster revenue (www.blockbuster.com and its remaining brick and mortar stores) goes to Dish Network/DISH? [I] have been considering this stock as it is receiving a lot of press from people saying 'its back,' which would not be the case if there is no longer an operating company behind it."
Based upon many reader comments, it appears there has been some confusion regarding the old and new Blockbuster. The stock BLOAQ is a shell of the former company, which was purchased out of bankruptcy in April by Dish Network. Dish purchased Blockbuster's assets, not its stock.
There's been some good news out of Blockbuster in recent weeks, and as a result it seems many shareholders snapped up shares of BLOAQ instead of Dish Network's stock. Yes, Blockbuster (the company) does seem to have at least regained some footing, but this is solely a benefit for its new parent, Dish Network, not the BLOAQ pink sheets.
Jumpingbeanie asks: "Kind of confused. Are these going to resume?"
While trading of Blockbuster's pink sheets have only been temporarily suspended (typically for a 10-day period), Grace Keith, a spokeswoman at OTC Markets, said based upon similar instances with other companies in the past she believes it is unlikely trading will resume and BLOAQ most likely will be removed within the next week.
Monkey55 asks: "So does this mean we should sell whatever stock we have in BLOAQ to try and regain whatever money we can?"
Unfortunately, at this point, you cannot buy or sell BLOAQ on the OTC Market.
Glory posted: "Is this another plot to defraud the innocent investors? If the stock were worthless, why has it been trading until yesterday? And why did SEC has to wait till today after such a heavy trade yesterday? Over 60 million shares were traded. The SEC should resume trading the stocks and let investors to wind down their investments with whatever loss they may incur. SEC should not act in such a way that it is collaborating to defraud the innocent investors."
The SEC halted trading of shares in response to an 8-K that was filed on Sept. 29 by BB Liquidating (formerly Blockbuster) that stated: "As a result of the asset sale, the debtors have no further business operations nor assets to liquidate. Dish Network is the current owner of the "Blockbuster" brand, inclusive of its ongoing retail, internet, and by-mail distribution channels. It is the debtors' understanding that such ongoing business operations are being managed by Blockbuster L.L.C. ("New Blockbuster"), which is an affiliate of Dish Network and a non-debtor entity. Accordingly, all inquiries concerning the ongoing business of New Blockbuster should be directed to Dish Network and the success or failure of New Blockbuster will have no impact on the recoveries anticipated in these chapter 11 cases for either creditors or equity interest holders of the Debtors. None of the publicly owned stocks issued by Parent prior to the commencement of these chapter 11 cases, including its Class A and Class B common stock, which are currently trading on the OTCQB under the symbols BLOAQ and BLOBQ, respectively, are or will become securities in DISH or New Blockbuster, which are independent, non-debtor companies. The Parent is currently in the process of changing the trading symbols for the Class A and Class B shares to maintain consistency with the change of the Parent's name to BB Liquidating Inc."
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