Nearly two decades ago, Redbox’s ubiquitous movie rental kiosks helped put video rental stores out of business. Now, Redbox’s parent company, Chicken Soup for the Soul Entertainment, is facing bankruptcy and serious questions about its future.
Via Deadline, Chicken Soup for the Soul Entertainment filed Chapter 11 bankruptcy last week after the company was reportedly late paying its employees while also slashing medical benefits. According to a message sent to employees, Chicken Soup applied for a debtor in possession loan that will allow it to make payroll and reinstate the lost medical benefits.
The bankruptcy filing has been made public, and it reveals that Chicken Soup owes $970 million to its unsecured creditors including Sony Pictures, Warner Bros. Pictures, Paramount, Universal Studios, Lionsgate, and Walmart. That’s not counting the company’s secured creditors, including the banks that lent money to Chicken Soup.
One of the big reasons why Chicken Soup for the Soul Entertainment is in such dire financial straits is that it made a number of pricy acquisitions that didn’t ultimately pay off, including Redbox, the Crackle streaming service, and Sonar Entertainment. The company also posted losses of $636.6 million in 2023. The bankruptcy court in Delaware will ultimately determine the next steps for Chicken Soup and whether it will be able to remain intact or if its assets will be sold off to pay its creditors. In the short term at least, the Redbox rental kiosks should still be available at your local supermarkets.
Image credit: Getty Images/Justin Sullivan
