Redbox, Universal renew 28-day deal

Redbox, Universal renew 28-day deal

LOS ANGELES

Cut-rate rental DVD kiosk operator Redbox said Thursday that it has renewed a deal to carry movies made by Universal Pictures 28 days after discs are made available for sale.

The deal extends through August 2014 a pact first made in April 2010.

Hollywood studios have differing views of how long Redbox, a subsidiary of Coinstar Inc., must wait after discs are released for sale. Some worry that consumers will rent instead of buying discs, which cuts into profits, while other studios don’t see a negative impact from renting and selling at the same time.

Time Warner Inc.’s Warner Bros. said in January that it would not sell Redbox discs for rental until 56 days after they are released for sale, doubling the delay from a previous deal in a bid to encourage purchases.

But Redbox has been able to get the discs through other sources, so now Warner Bros. titles are available seven days after release.

Banks lead rally on Wall Street

NEW YORK

Banks dodged a big hit from the Greek debt crisis and rallied Thursday to lead the stock market higher. Strong retail sales and more encouraging news about the U.S. job market also helped stocks rise.

The banks of the world are on the hook for as much as $70 billion in bond-insurance payments if Greece defaults on its debt. But a panel ruled that Greece’s plan to restructure its debt should not trigger any insurance payments, at least not yet.

Bank stocks pushed higher in relief. Goldman Sachs jumped 5.2 percent, and Morgan Stanley gained 3.5 percent.

JPMorgan Chase and Bank of America were the top gainers in the Dow Jones industrial average. The Dow added 28 points to close at 12,980.30. That’s a gain of 0.2 percent.

Yelp sets IPO at $15

Yelp’s popular online reviews guide the hungry to the best restaurants, the thirsty to the friendliest bars and the flabby to the toughest personal trainers. But, on the eve of its initial public offering, the 8-year-old, still unprofitable company had yet to convince analysts of its long-term prospects.

On Thursday night, San Francisco-based Yelp Inc. priced its IPO at $15. That’s above the $12 to $14 range it was expecting.

The stock will begin trading today under the ticker symbol “YELP.” The company plans to sell 7.1 million shares, while its charitable foundation will sell 50,000. Investment bankers also have an option to sell an additional 1.07 million shares, depending on investor demand.

The offering could raise as much as $123 million before expenses. It values Yelp at $900 million.

That’s a lot for a company that hasn’t turned a profit since its 2004 founding. Rick Summer, an analyst at Morningstar, says that although Yelp is at “the head of the pack” compared with other review sites, he’s concerned that businesses “may not see enough value in [Yelp’s] advertising platform to increase spending and justify the expected price of this IPO.”

Associated Press