Home > News > Movie Gallery Plans Chapter 11 Filing • Bookmark   • Newsletters   • Register Search Options


Movie Gallery Plans Chapter 11 Filing

Company, which rents adult titles, hopes to emerge from bankruptcy in early 2008.
Movie Gallery Plans Chapter 11 Filing
Get XBIZ News
Oct 8, 2007 9:45 AM PDT    Text size: 
DOTHAN, Ala. — Video rental giant Movie Gallery plans to file for Chapter 11 bankruptcy protection this month and looks ahead to restructure its finances in a pre-negotiated deal with key creditors.

The Dothan, Ala., company, which rents adult titles, hopes to emerge from Chapter 11 in early 2008, according to the Wall Street Journal, whose sources spoke on condition that they not be identified.

The company hasn't publicly acknowledged the possibility of the Chaper 11 filing, but a growing number of financial analysts have predicted it.

Movie Gallery, which operates more than 4,600 video rental stores in the U.S., Canada and Mexico, has been facing performance issues since acquiring competitor Hollywood Entertainment in 2005.

Sluggish rental trends have made it difficult for the company to stay current on its required debt payments.

In July, when it said it had $1.2 billion in debt, Movie Gallery failed to comply with terms of a senior loan, leading to speculation of a potential Chapter 11 filing. Since then, the company has looked to preserve cash and tried to negotiate with its lenders a financial restructuring to solve its debt troubles.

Earlier this month, Movie Gallery said it would close about 520 underperforming Movie Gallery and Hollywood Video stores. Prior to that, the company delayed the planned launch of a DVD-by-mail subscription service.

Under the plan that includes the bankruptcy filing, Movie Gallery would convert its bonds to stock, and a portion of its second-lien debt also will be converted to stock.

More ways to get XBIZ News:  RSS Feeds  |  E-Newsletters  |  Desktop Widget  |  Mobile
Looking for porn star news and behind-the-scene videos? Check out XFANZ.com !


How to Buy Google and Facebook Traffic

‘Wait a minute! Isn’t this an adult industry publication?” Of course, your eyes don’t deceive you. “Why are you talking about buying mainstream traffic with Google and Facebook?... More »

Creating a Top-Notch, Lucrative Adult Website

If there’s one thing I’ve seen consistently over the 10 years I’ve been running Elevated X and working exclusively with paysite owners it’s that no matter how competitive the paysite... More »

Artificial Intelligence Treats Risk Like Cancer

An embarrassing thing happened to me in Amsterdam. I’d just finished dinner with a new partner at a nice restaurant. OK … more expensive than nice, but you know what I mean. I grade food in... More »
Stay informed of the latest industry developments. Get XBIZ newsletters delivered to your inbox. Subscribe today!
Enter email address:

* To manage existing subscriptions click here.

Submit your press release to
multiple news outlets with 1 click.
Subscribe to RSS news feeds or
add free content to your website.
Access XBIZ news and articles
with your mobile device.
Subscribe to XBIZ Premiere magazine, the industry's leading adult retail trade publications, delivering the most timely and comprehensive business news and information to producers and retailers of adult products.



Nov 04 - Nov 06
Edison, New Jersey

2016 Inked Awards

Nov 05 - Nov 05
Edison, New Jersey

XBIZ 2017

Jan 09 - Jan 13
Hollywood, CA

XBIZ Awards 2017

Jan 12 - Jan 12
Los Angeles, CA
Everyday thousands of business professionals browse XBIZ's industry directory for quality products and services. Not listed yet? Your company could be losing potential new business. Submit your company today!
Use XBIZ RSS feeds to stay informed of the latest industry developments or as a content syndication tool for your website!