Blockbuster Offering to Buy Hollywood’s Bonds

Blockbuster Inc. said it was offering to buy all of Hollywood Entertainment Corp.’s 9.625% bonds due 2011 as part of its earlier bid of $14.50 a share for Hollywood’s stock.

Blockbuster said it would seek the consent of the holders of $225-million principal amount of notes to change certain terms of the bond indenture.

Blockbuster is competing with Movie Gallery Inc., the No. 3 U.S. video-rental company, to buy Hollywood Entertainment, the No. 2 chain.

Shares of Dallas-based Blockbuster fell 5 cents to $9.40 on the New York Stock Exchange. Wilsonville, Ore.-based Hollywood Entertainment rose 20 cents to $14.27 on Nasdaq.