Blockbuster auction to continue into second day
New York City — Blockbuster’s bankruptcy auction is set to stretch into a second day on Tuesday after preliminary talks between bidders and the chain’s representatives dragged on late into Monday, a company spokesman said.
Blockbuster did not say how many bidders it attracted, but halls outside the auction room in Manhattan bankruptcy court were packed with attorneys and investment bankers refining their bids throughout Monday, Reuters reported.
With talks wrapping up Monday evening, the bidding itself is set to take place on Tuesday and will be public, said Blockbuster spokesman Michael Freitag, according to Reuters.
Satellite television company Dish Network Corp. and billionaire investor Carl Icahn qualified for the auction by submitting bids last week, the Wall Street Journal reported on Friday, citing people familiar with the matter.
A Dish spokesman declined to comment. Icahn did not return calls seeking a comment, but a room at the courthouse was reserved for the Icahn group.
Gordon Brothers Group and Hilco Merchant Resources also submitted a joint bid for Blockbuster’s inventory, the Journal said on Monday.
The auction will be followed by a hearing before federal bankruptcy judge Burton Lifland on April 7 to approve the new owner.
Diamond Foods takes a chip out of P&G
SAN FRANCISCO and CINCINNATI — A Procter & Gamble potato chip brand will merge with a snack company in a $2.35 billion deal.
P&G said that it inked a definitive agreement to merge its Pringles business into Diamond Foods — whose portfolio includes such brands as Emerald Nuts and Pop Secret popcorn — which boasted revenues of about $2.4 billion. The transaction, which is expected to be completed by the end of 2011, is subject to approval by Diamond shareholders and the satisfaction of customary closing conditions and regulatory approvals.
Diamond Foods president and CEO Michael Mendes called the deal a "strategic combination" and that the company will build on Pringles’ brand equity. The combined business will remain in San Francisco, Diamond Foods said.
For fiscal year 2012, Diamond anticipates strong growth in its core business with earnings per share of $2.85 to $2.98 on a standalone basis, which represents a 30% increase over 2010 EPS.
Walgreens’ March sales jump
DEERFIELD, Ill. — Walgreens on Tuesday reported March sales of $6.3 billion, an increase of 7.6%. Duane Reade stores, acquired in April 2010, contributed 280 basis points to the total sales increase for the month.
Total front-end sales increased 8.4% in March, including 470 basis points from Duane Reade stores. Despite the negative impact of this year’s later Easter, which falls on April 24 this year, compared with April 4 last year, comparable-store front-end sales increased 1.6%. Customer traffic in comparable stores increased 0.8%, while basket size increased 0.8%.
Prescriptions filled at comparable stores increased 3.5% in March. Calendar day shifts negatively impacted prescriptions filled in comparable stores by 90 basis points.
March pharmacy sales increased 7.3%, while comparable pharmacy sales increased 3.7%. Comparable pharmacy sales were negatively impacted by 230 basis points due to generic drug introductions in the last 12 months. Pharmacy sales accounted for 66.4% of total sales for the month.
Sales in comparable stores for the month increased 3%. Duane Reade stores are not included in any comparable store results. Walgreens will report combined comparable-store sales for March and April with its April sales results.