Movie Gallery Announces Expiration of Hart-Scott-Rodino Waiting Period
February 14 2005 - 6:00AM
PR Newswire (US)
Movie Gallery Announces Expiration of Hart-Scott-Rodino Waiting
Period Planned Acquisition of Hollywood Entertainment Cleared by
Federal Regulators DOTHAN, Ala., Feb. 14 /PRNewswire-FirstCall/ --
Movie Gallery, Inc. (NASDAQ:MOVI) today announced that the waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act of
1976 (HSR Act) has expired, indicating regulatory clearance of
Movie Gallery's planned acquisition of Hollywood Entertainment
Corporation (NASDAQ:HLYW) effective February 11, 2005. "We are
pleased with this important development and we believe that the
Movie Gallery merger is the best option for Hollywood's
shareholders, employees and customers," said Page Todd, Executive
Vice President and General Counsel of Movie Gallery. "Clearing the
pre-merger review process confirms what we have said all along --
Movie Gallery stores do not have any substantial overlap with
Hollywood's stores and therefore pose no risk to competition. In
contrast, we believe that Blockbuster's proposal poses significant
regulatory risk, as more than 80 percent of Hollywood's stores are
in the same local market as a Blockbuster store." "We are confident
that our all-cash acquisition of Hollywood provides greater closing
certainty and will deliver concrete value to Hollywood shareholders
sooner than Blockbuster's highly conditional proposal," Todd
concluded. The company noted that Blockbuster's proposed exchange
offer for Hollywood is still under investigation by the Federal
Trade Commission (FTC). Unlike Movie Gallery, Blockbuster received
a Request for Additional Information from the FTC in connection
with its proposed acquisition of Hollywood. Since Blockbuster's
proposal includes consideration in the form of Blockbuster shares,
under the HSR Act, it must wait an additional thirty days after it
has substantially complied with the FTC's Request for Additional
Information before it can move forward with its proposed offer
unless either the FTC terminates the waiting period or a court
refuses to grant a permanent injunction. As previously announced on
January 10, 2005, Movie Gallery has entered into a definitive
merger agreement to acquire Hollywood for $13.25 per share in cash.
The closing of the transaction remains subject to other customary
conditions, including the approval of Hollywood's shareholders.
About Movie Gallery Movie Gallery, Inc. is the third-largest
company in the specialty video retail industry based on revenues
and the second-largest in the industry based on stores. As of
December 31, 2004, Movie Gallery owned and operated 2,482 stores
located primarily in the rural and secondary markets throughout
North America. Since the company's initial public offering in
August 1994, Movie Gallery has grown from 97 stores to its present
size through acquisitions and new store openings. Forward-Looking
Statements This news release contains forward-looking statements
relating to Movie Gallery's intent to acquire Hollywood
Entertainment. Specific forward-looking statements relate to Movie
Gallery's expectations regarding the potential benefits of such
transaction, including the anticipated benefits to Hollywood's
shareholders, employees and customers. These forward-looking
statements are based on Movie Gallery's current intent,
expectations, estimates and projections and are not guarantees of
future performance. These statements involve risks, uncertainties,
assumptions and other factors that are difficult to predict and
that could cause actual results to vary materially from those
expressed in or indicated by them. In addition, some factors are
beyond Movie Gallery's control. Certain statements made in this
release are contingent upon completion of the proposed transaction.
Other factors that could cause actual results to differ materially
from the statements made in this release include, among others: (i)
matters related to closing conditions contained in the merger
agreement between Movie Gallery and Hollywood, including approval
of the Hollywood shareholders and conditions to the consummation of
the financing contemplated by the merger agreement; and (ii) other
factors as described in Movie Gallery's filings with the Securities
and Exchange Commission, including the detailed factors discussed
under the heading "Cautionary Statements" in Movie Gallery's annual
report on Form 10-K for the fiscal year ended January 4, 2004.
HOLLYWOOD STOCKHOLDERS ARE URGED TO READ THE DEFINITIVE PROXY
STATEMENT REGARDING THE PROPOSED TRANSACTION WHEN IT BECOMES
AVAILABLE, BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION.
Stockholders will be able to obtain a free copy of the definitive
proxy statement, as well as other filings containing information
about the parties, without charge, at the Securities and Exchange
Commission's Internet site (http://www.sec.gov/ ). Copies of the
definitive proxy statement and the filings with the SEC that will
be incorporated by reference in the proxy statement will also be
available, without charge, by directing a request to Hollywood
Entertainment Corp., 9275 S.W. Peyton Lane, Wilsonville, Oregon
97070, Attn: Investor Relations. The directors and executive
officers of Hollywood and other persons may be deemed to be
participants in the solicitation of proxies in respect of the
transaction. Information regarding Hollywood's directors and
executive officers will be available in the definitive proxy
statement. Other information regarding the participants in the
proxy solicitation and a description of their direct and indirect
interests, by security holdings or otherwise, will be contained in
the definitive proxy statement and other relevant materials to be
filed with the SEC when they become available. Contact: Financial:
Thomas Johnson (334) 702-2400 Media: Andrew Siegel (212) 895-8627
DATASOURCE: Movie Gallery, Inc. CONTACT: Financial - Thomas
Johnson, +1-334-702-2400, or Media - Andrew Siegel,
+1-212-895-8627, both for Movie Gallery, Inc. Web site:
http://www.moviegallery.com/
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