thumb|Hollywood Video with attached [[Game Crazy location in Springboro, Ohio in 2009]]
Movie Gallery, Inc. (stylized as MO>IE GALLERY) was an American movie and game rental company based in Wilsonville, Oregon. With a total of 4,749 stores at its peak, it was the second largest video retailer in the United States and Canada, behind Blockbuster Video. The company rented and sold Blu-ray Discs, DVDs, VHS tapes, and video games. Initially founded in Dothan, Alabama by Joe Malugen and Harrison Parrish, the company moved its headquarters to Wilsonville in 2009.
On April 30, 2010, Movie Gallery announced it was closing and liquidating all of its stores per a filing of Chapter 7 bankruptcy. At the time of the company's bankruptcy, the company had approximately 2,500 stores in North America, operating under the Movie Gallery, Hollywood Video, and GameCrazy brands. The last of the company's stores were closed on August 8, 2010.
In 2011, three Movie Gallery locations in Northwest Arkansas reopened by an independent business owner who acquired the trademark rights in Arkansas.
Most regular Movie Gallery stores were located in rural areas, while Hollywood Video locations, which competed directly with Blockbuster, were located in urban areas. In 2000, Movie Gallery again set its goal at opening 100 new stores and relocating 25. This goal was surpassed.
The company moved forward with its largest single-chain acquisition to date, expanding its base of stores by 30%, in late December 2001. The addition of Video Update stores to the Movie Gallery family launched the company's international presence with 100 retail locations in Canada. From 2001 to 2002, the number of Movie Gallery stores has increased by 49 percent, or 510 locations, most of which were acquired through the purchase of Video Update. Movie Gallery achieved the 1,678 store mark in 2002.
In 2005, the company completed the largest acquisition to date with the Hollywood Entertainment merger. This combination of companies increased the store total to 4,700 with revenues in excess of $2.5 billion. In addition, Movie Gallery opened 61 new stores in Western Canada with the acquisition of VHQ Entertainment.
Downfall
The company began having financial difficulties and announced the closure of 520 stores in September 2007. At the time Movie Gallery had about 4,500 locations. Because of these troubles, the stock price dropped below $1 (~$ in ) per share and was removed from listing on the NASDAQ stock exchange in November 2007.
An additional 400 stores were scheduled to close announced in February 2008, followed by another 160 stores were scheduled to close announced in April 2008 during the bankruptcy reorganization. Movie Gallery emerged from Chapter 11 in May 2008 The company relocated its headquarters to Wilsonville, Oregon (home of the Hollywood Video subsidiary), in late 2008. In January 2009, they closed their Wilsonville distribution center. Canadian operations included over 200 "Movie Gallery" branded stores, as well as approximately 60 under the VHQ brand in western Canada. In 2009 Movie Gallery closed its Wilsonville, Oregon distribution facility, merging it with one in Nashville, Tennessee. and many locations fell behind on rent. On February 1, 2010, stores received a report stating that about 800 stores were to be shut down. The company hired the law firm of Sonnenschein, Nath & Rosenthal to prepare for a second filing of bankruptcy, and on February 3, 2010, they again filed for Chapter 11 bankruptcy protection. During a company-wide conference call on April 30, 2010, it was announced that all U.S. Hollywood Video, Movie Gallery, and Game Crazy stores would file for Chapter 7 bankruptcy in May 2010.
Subsidiaries
MovieBeam
MovieBeam was a set-top service offered in larger cities in which customers could download movies to a set-top box. Most movies expired within 24 hours of downloading. The company was founded by Disney and other investors as an alternative to online movie downloads. A special set-top box had to be purchased by consumers for the service at a retail price of $149.95. Most major movie studios provided new release content to the service. However, MovieBeam failed to gain any serious traction in the marketplace. MovieBeam was shut down on December 15, 2007. As of June 2008 the remnants of MovieBeam, including its trademarks and other intellectual properties, were sold to an outside investors group for approximately $2 million (~$ in ) as part of the company's restructuring. All in-store kiosks for the service were then removed as well.
Hollywood Video
thumb|right|A typical Hollywood Video outlet in [[San Lorenzo, California in 2007]]
Hollywood Video, a subsidiary of Movie Gallery, Inc., operated from Wilsonville, Oregon, as a DVD and video game rental shop chain in the United States. It was started in 1988 by former CEO Mark Wattles and his wife. The chain was the largest direct competitor of Blockbuster Video until it was purchased by Movie Gallery in 2005. Hollywood Video declared bankruptcy in February 2010 and announced that it would shut down three months later.
Purchase of Hollywood Video
Hollywood Video was the target of a hostile takeover attempt, initially announced at the end of December 2004 by competitor Blockbuster Video. In February 2005, Blockbuster announced an exchange offer of $14.50 (~$ in ) per share ($11.50 cash and $3.00 in Blockbuster shares).
In order to create a stronger position against the hostile takeover, Hollywood Video agreed to a buyout on Monday, January 10, 2005, by its smaller competitor Movie Gallery. Movie Gallery paid $860 million, $13.25 per share, and the assumption of $380 million in debt. Stocks closed at $13.85 on January 10 after the news. Blockbuster then dropped its purchase plans, citing anti-trust concerns. Movie Gallery completed its purchase of Hollywood Video on April 27, 2005.
Headquarters
Movie Gallery originally had its headquarters in Dothan, Alabama. In Dothan, the company had of space in the Porter Square Mall. Later in its life the company's headquarters were in Wilsonville, Oregon.
In 2005 Movie Gallery bought Hollywood Video, gaining Hollywood's office space in Oregon. and Hollywood Video, now a subsidiary of Movie Gallery, maintained its headquarters in Wilsonville.
See also
- Veterans Memorial Stadium in Troy, Alabama, formerly Movie Gallery Stadium