Maisam Ali

Group B

MBA 3.5 MORNING

BLOCKBUSTER

Blockbuster is a provider home movie and video game rental services

through video rental shop.

In 2004 Carl icahn was interested in to buy shares of blockbuster.

Carl icahn is one of activist shareholder. He invested money in
blockbuster in same year. He invested money becasuse he was
confident in capitalizing on failure by fixing troubled businesses.

Another thing that he saw in the company is the market share, was
25% he believed, that was an opportunity to me, and is could be
fixed quickly and we can make money from this.

At the time when different technology shifts occurred they convert

the business into online and eliminate late fee as well. Which costs
$400 million. This also a big decision by board and cannot considered
the company shareholders in this decision.

In 2005 AGM the voters not given their vote to Carl icahn to become
a director of a company director. Because shareholder didn’t wanted
as activist investor is to become a director of blockbuster.

In December 2006 the board of directors decided the executive

compensation because blockbuster had a good year, and was due big
bonuses. Which is about $50 million. This compensation packages
are not approved by shareholders. It means directors don’t care
company shareholders. Because there is no accountability on CEOs.
That’s why the blockbuster is failed due to the too many changes in
the industry.

At 2010 Carl icahn leave the blockbuster and sold the stock at 26
cent per share. And at the same year the blockbuster filed for the
bankruptcy as well.

THE END