DVD Kiosk Firm Redbox Bought Out By Coinstar For Up To $176 Million; McDonald's Paid Out
This story was written by Rafat Ali.
Redbox, the DVD rental kiosk company been bought out completely by its majority owner, publicly-traded coin-counting machine maker Coinstar. The company announced yesterday that it was paying GetAMovie Inc., an affiliate of McDonald's, $10 million in cash and 1.5 million shares of Coinstar common stock, and will buy the the remaining interest from other minority owners for between $21.5 million and $25 million. Also, it will pay other investors as well, with a total that could add up to $176 million, in cash and Coinstar's stock. Details in release.
Redbox is located in 12,000 retail locations, including McDonald's outlets, *Wal-Mart* and Walgreens stores, and rents movies for $1 per night. It had filed for an IPO in May last year, but with this current move and market conditions, doesn't look like that will happen anytime in the future. The company has also been in a scuffle with Universal Studios, where the NBCU-owned company had threatened to cut off Redbox's supplies of movies from its stable, if the kiosk company continued to rent out the movies at the low price (more details on that here).
By Rafat Ali