The inspirational book series Chicken Soup for the Soul, which has sold over 500 million copies worldwide, recently filed for bankruptcy protection in a Delaware court due to nearly $1 billion in debt. Despite having $414 million in assets as of March 2024, the company faced financial trouble and needed to work out a debt repayment plan.
The acquisition of Redbox in 2022 left the company with a substantial debt of $360 million, which Chairman William J. Rouhana Jr. believed could have been managed if capitalized on the post-pandemic movie releases. However, as the film industry recovers, Chicken Soup still requires additional cash to purchase and distribute new content, leading to a cash shortage. The company is currently unable to pay its suppliers for movies, leading to operational challenges and disappointing business results, especially within the Redbox segment.
To address its financial issues, Chicken Soup plans to sell off part of the business and restructure the remainder. The company still operates thousands of Redbox DVD rental kiosks across the U.S. and owns the video streaming service Crackle, which relies on advertising revenue for operation. In addition to its core book series, Chicken Soup for the Soul has ventured into various other avenues such as movies, television, and pet food products. The company went public in 2017, marking a significant point in its history. Despite its current financial challenges, Chicken Soup for the Soul remains a prominent and well-known brand in the entertainment industry.
Chairman William J. Rouhana Jr., who has led Chicken Soup since its founding in 1993 by Mark Victor Hansen and Jack Canfield, stated that “This decision was not made lightly,” but it was necessary to ensure that Chicken Soup could continue to operate sustainably moving forward.” He added that “Our mission is still to inspire people around the world through our content,” but “we need more resources than we have now.”
Chicken Soup’s bankruptcy filing comes after several years of financial struggles following its acquisition of Redbox in 2022 for $360 million. Despite selling over 50 million Redbox units annually at one time during that period
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