Blockbuster raises $675 million in debt

Dallas Blockbuster said Friday that it closed a $675 million debt offering due in 2014 and will use the proceeds to repay other outstanding debt.

The company said the senior secured notes carried an interest rate of 11.75% and was issued at 94% of par value.

The company said it will use the funds to repay the remainder of what it owes under a revolving credit facility and other debt instruments. However, letters of credit that were outstanding under the revolving credit facility will remain outstanding.

Blockbuster said it remains on track to cut expenses by $200 million this year, with $166 million also reduced in the first half. It will continue to seek ways to boost efficiency, including divesting of non-core assets outside North America.