Chicken Soup for the Soul Entertainment Files for Chapter 11 Bankruptcy
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Chicken Soup for the Soul Entertainment, the owner of the movie rental service Redbox, has filed for Chapter 11 bankruptcy protection. The company, which acquired Redbox in 2022, is grappling with significant financial challenges, including a debt burden of $970 million.
In a recent SEC filing, the company disclosed net losses amounting to $636.6 million for 2023. Reports from Deadline indicate that the company has already suspended medical benefits and missed payroll, leaving employees without pay for over a week.
In a message to employees on Saturday, Chicken Soup for the Soul Entertainment announced that it had applied for a debtor-in-possession loan to address the situation. “Upon court approval, we expect payroll to be funded early in the week and funding for this upcoming week’s payroll to also be secured,” the message stated, according to Deadline. “We also expect to have the funds to reinstate medical benefits back to May 14, 2024, and going forward.”
The acquisition of Redbox for $375 million added substantial debt to Chicken Soup for the Soul Entertainment’s financial load. The company owes money to various creditors, including major retailers, studios, and streaming platforms such as Walmart, Universal, and Sony.
In addition to Redbox, Chicken Soup for the Soul Entertainment owns the streaming service Crackle and other film and TV brands. The company is also known for its long-running series of self-help books.
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