Blockbuster (BBI: 0.7136, 0.0336, 4.94%) denied on Tuesday it plans to file for bankruptcy protection, swatting down rumors that sent shares of the world’s largest movie rental chain down nearly 80%.

“We don’t intend to file for bankruptcy,” spokeswoman Karen Raskopf told FOX Business.

The comments come in contrast with an earlier Bloomberg News report that said Blockbuster hired a bankruptcy law firm to evaluate restructuring, which could include a “pre-packaged bankruptcy.” Reuters also reported the debt-laden company hired investment bank Rothschild to explore restructuring options, including a Chapter 11 filing.

The reports sent Blockbuster’s stock down 77% before it was halted. Shares of Blockbuster never reopened for trading on Tuesday.

Blockbuster confirmed it hired bankruptcy specialists Kirkland & Ellis LLP but said the law firm will assist it with its ongoing capital raising initiatives. Specifically, Blockbuster is seeking to restructure a revolving credit facility that is due to mature in August.

Raskopf also said the halt in trading is a “normal course of action” due to market rumors the company wanted to clarify.

Blockbuster, which has more than 7,500 rental stores in multiple countries, has struggled as people have moved away from the traditional store-based movie rental business and begun watching movies online. The company’s primary competitor, Netflix (NFLX: 46.98, 0.61, 1.32%), saw its shares rise as much as 12% before paring its gains.

Blockbuster, in order to save its business, offered a year ago to merge with then-struggling electronics company Circuit City. The merger was not taken seriously by the market or Circuit City and the proposal never took off. Circuit City filed for Chapter 11 bankruptcy in late 2008 and now is in liquidation.