NATIONAL NEWS – Redbox is shutting down due to bankruptcy liquidation
Zoe Mckey, Staff Writer
Redbox is shutting down its network of 24,000 DVD rental kiosks and streaming services after over two decades of operation. The closure comes as its parent company, Chicken Soup for the Soul Entertainment, has converted its Chapter 11 bankruptcy case to a Chapter 7 liquidation proceeding. This move leaves all of the company’s 1,033 employees without jobs, severance, or extended benefits. Redbox, which once operated over 43,000 kiosks and peaked in revenue at $1.97 billion in 2013, had been in decline for over a decade before its acquisition by Chicken Soup for the Soul Entertainment in 2020.
Chicken Soup for the Soul Entertainment has struggled financially, listing debts of $970 million against assets of $414 million as of March 31, 2024. Creditors include major entertainment companies such as Universal Studios and Sony Pictures. The company’s bankruptcy court judge highlighted the inability to continue paying employees or bills, leading to the appointment of a bankruptcy trustee to investigate potential fund misappropriation. The company’s chairman and CEO, Bill Rouhana Jr., cited lenders’ failures to fulfill obligations as a contributing factor to the financial difficulties. The acquisition of Redbox in 2020 included assuming nearly $360 million of its debt, which was expected to be mitigated by a partial return to pre-COVID levels of theatrical releases.