Bankruptcy

PwC: MovieLink’s Run May End

New owner Blockbuster saddled with steep losses for the movie-download company.
Stephen TaubOctober 26, 2007

Blockbuster’s auditor has questioned the viability of MovieLink, which the company acquired in August.

PricewaterhouseCoopers said it has “substantial doubt about the company’s ability to continue as a going concern,” according to a letter disclosed in a regulatory filing. The auditor cited recurring losses from operations, negative cash flows from operating activities, and MovieLink’s accumulated deficit. According to accompanying financials, MovieLink had an accumulated deficit of $145 million as of June 30, 2007.

MovieLink offers movies that can be downloaded from the Internet. It was previously owned by a group that included some of the largest Hollywood studios.

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