BBI Soars; Denies Bankruptcy

Shares of Blockbuster Inc. (BBI) have doubled in price to 44 cents in afternoon trading as the company denied reports that it was considering filing for bankruptcy.

The stock declined as much as 86% on Tuesday as reports poured in that it has hired law firm Kirkland & Ellis LLP for a possible bankruptcy filing. Company spokeswoman Karen Raskopf has now clarified that the law firm was hired for Blockbuster's refinancing and capital raising initiatives and not for bankruptcy.

The company, which will report fourth quarter earnings on Mar 19, is expected to comment on the status on the various options being considered to refinance its senior credit facility (which matures on Aug 20).

Read the full analyst report on BBI