Blockbuster withdraws Circuit City bid

DALLAS Blockbuster announced on July 1 that it has decided to withdraw its bid to acquire Circuit City. In June the company had made an offer estimated at $1.3 billion.

"Based on market conditions and the completion of our initial due diligence process, we have determined that it is not in the best interest of Blockbuster's shareholders to proceed with an acquisition of Circuit City," said Jim Keyes, Blockbuster chairman and ceo. "We continue to believe in the strategic merits of a consumer retail proposition that would bring media content and electronic devices together under one brand. We will pursue this strategy through our Blockbuster stores as a way to diversify the business and better serve the entertainment retail segment."

Commenting on Blockbuster's decision, Circuit City that it will continue to explore strategic alternatives.

Philip Schoonover, chairman, president and ceo of Circuit City, commented, "Our exploration of strategic alternatives is intended to serve the interests of our shareholders by considering every possible alternative to enhance shareholder value. The board's review was not dependent on Blockbuster's participation. We are diligently working with the parties involved in the process, and intend to continue our thorough approach until such point as the board determines upon a particular strategic course of action. The board has not established a deadline for completing the review."