Blockbuster Cuts Size of Viacom Debt by $50 Million

Authored by Mark Hefflinger on September 2, 2009 - 8:08am.

Dallas - Video rental giant Blockbuster (NYSE: BBI) announced on Wednesday that it has reduced the amount of letters of credit maintained for former parent company Viacom (NYSE: VIA) by $50 million, from $75 million to $25 million, in a bid to improve liquidity.

The move reflects a reduction in Viacom's exposure to Blockbuster's lease obligations on its stores.

The company also recently sold its Ireland-based Xtra-vision store chain for $45 million.

"We are pleased to have reached this agreement with Viacom, which delivers on our promise to improve liquidity through a number of initiatives," said Blockbuster chairman and CEO Jim Keyes.

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