Camerons and Linklaters advise as Blockbuster goes into administration

CMS Cameron McKenna has taken the lead legal role as DVD and video games rental company Blockbuster yesterday (16 January) announced it was going into administration.

Blockbuster, which employs 4,190 staff in 528 stores across the UK, is the latest in a spree of retail chains to collapse, following the news last week that music and video store HMV and camera retailer Jessops are both entering administration.

The CMS team, which is advising both Blockbuster and administrators Deloitte, is being led by banking and finance head Rita Lowe and corporate recovery and restructuring partner Ashley Smith, alongside real estate partner Pranai Karia.

Linklaters is advising the US parent company, Blockbuster LLC, with New York corporate partner Dan Dufner leading a team assisted by restructuring and insolvency lawyers in London.

Camerons partner Lowe is also currently leading the firm’s team advising Dewey & LeBoeuf’s UK LLP on its wind-down proceedings.

Deloitte partners Lee Manning, Matthew David Smith and Neville Kahn have been appointed as joint administrators.

“In recent years Blockbuster has faced increased competition from internet based providers along with the shift to digital streaming of movies and games,” said Manning in a statement.

“We are working closely with suppliers and employees to ensure the business has the best possible platform to secure a sale, preserve jobs and generate as much value as possible for all creditors.”

According to The American Lawyer, Weil Gotshal & Manges was called in to act for the US arm of the company when it filed for bankruptcy in 2010, with other recent advisers including Kirkland & Ellis, which acted on a 2009 debt restructuring for the company.

CMS Cameron McKenna’s appointment follows a spate of roles for law firms in the wake of several high-profile retail collapses, with Linklaters and Morrison & Foerster picking up roles on the HMV administration, and SNR Denton taking the lead role for PricewaterhouseCoopers on the Jessops collapse.