Viacom May Write Down Blockbuster’s Assets

Viacom Inc., signaling that investors are shunning its plan to split off Blockbuster Inc., said it might have to write down the value of the video rental chain’s assets.

Viacom in June announced an exchange offer for its 82% stake in Blockbuster. Under this plan, the parent company would use its Blockbuster shares as a currency to buy back Viacom stock from investors.

In a regulatory filing, Viacom said “recent developments” in the exchange offer have shown that Blockbuster must reassess the value of assets on its balance sheet. The investment banks hired to handle the exchange offer may be finding that investors are demanding a big discount on Blockbuster shares in return for their Viacom stock, analysts said.

Viacom fell 36 cents to $35.30 and Blockbuster fell 39 cents to $12.91, both on the NYSE.