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In the opening move of the auction, the Icahn group offered $291.4 million to take the lead in an early sign that he was a serious contender for an acquisition.
The group of financial firms that came together under the name Cobalt Video Holdco includes Monarch Alternative Capital, Owl Creek Asset Management, Stonehill Capital Management and Varde Partners. It had previously made a $290 million bid that was slightly different in certain financial details and that set the minimum acceptable in the Blockbuster auction.
Lifland, who is overseeing the bankruptcy case, made available rooms at the bankruptcy court for the auction process, which had started Monday with a non-public portion.
In the early afternoon, SK representatives had pitched the mobile firm’s latest bid as the best deal for studios, saying its goal was to preserve relationships with Hollywood players. If SK was successful, studios would get “over and above those amounts contemplated by all the other bids,” a rep said Tuesday afternoon.
In fact, the rep said the company has reached deals for future distribution, if the bid turned out to be successful, with Sony, Universal and Fox. SK said its bid offered $60.7 million in total value for studios. That figure included a pro-rata distribution of $11.5 million to studios owed money by Blockbuster and $49.2 million in additional money for the three studios with which SK had reached going-forward agreements.
The team running the auction, however, ruled that the SK bid overall had a lower value than a previous bid from the group of financial firms. SK’s reps requested time to mull a latest bid modification before returning to the room later. A rep then said that the company wouldn’t update its bid as it still deemed it the best and highest. He added that SK was reserving all rights as the company was eliminated from the process by the Blockbuster reps overseeing it.
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