Redbox owner Chicken Soup for the Soul files for bankruptcy
By Jordan Valinsky, CNN
New York (CNN) — The parent company of Redbox, those distinctive, red-colored kiosks at grocery stores that sell or rent DVDs, has filed for bankruptcy after enduring months of financial struggle.
Chicken Soup for the Soul Entertainment (CSSE) revealed in a filing that it has nearly $1 billion in debt and owes millions of dollars to several entertainment companies including the BBC and Sony Pictures, plus to retailers ranging from Walmart to Walgreens.
Filings show that the company took on about $325 million in debt following its purchase of Redbox in 2022 from private equity giant Apollo Global Management. The plan was to make it into an entertainment conglomerate, combining the DVD rental business with its free streaming services, like Crackle, the entertainment platform once owned by Sony.
Those plans didn’t pan out, hindered by dual Hollywood strikes that limited production of fresh content and the decline of people renting physical DVDs that even forced rival Netflix to quit that part of its business last year.
CSSE declined to comment.
Deadline previously reported that Redbox hadn’t paid employees for a week, and medical benefits have been suspended. Filing for Chapter 11 bankruptcy could help the company fix those issues if its plans are approved by a court in Delaware.
The company’s publishing arm, which produces those ubiquitous self-help books that were once a worldwide phenomenon, isn’t affected by the bankruptcy filing of its entertainment unit.
The number of Redbox kiosks has grown to about 34,000 across the US, largely located at grocery and drug stores. Since its 2002 launch, Redbox has rented its 1 billion discs at prices cheaper than cable, according to its website.
The-CNN-Wire
™ & © 2024 Cable News Network, Inc., a Warner Bros. Discovery Company. All rights reserved.
