Blockbuster Inc. (Dallas), which had been involved in a months-long bidding war with Movie Gallery Inc. (Dothan, Ala.) over the rights to acquire Hollywood Video (Wilsonville, Ore.), has let its tender offer expire as of midnight, March 24.
The decision ends the hostile takeover bid and clears the way for the Numbers Two and Three in the video rental marketplace to merge.
“Our decision not to extend our offers was reached after a careful review of all of the available facts and circumstances,” said Blockbuster chairman and ceo John Antioco. “Among those things that played prominently for us were Hollywood’s recent public filings and the unlikely resolution of our request for regulatory clearance on an acceptable timetable. Given the current circumstances, in our judgment it is not in Blockbuster’s best interest to continue to pursue the acquisition, The tender offers expired in accordance with their terms, and Blockbuster will not accept for payment and will not pay for any tendered shares or notes.”
“We believe that Movie Gallery’s definitive agreement to acquire Hollywood is in the best interests of Hollywood’s shareholders, employees, and customers,” said Movie Gallery chairman, president and ceo Joe Malugen. “Movie Gallery has already received regulatory approval and we look forward to closing the Hollywood transaction promptly after the Hollywood shareholder vote on April 22, 2005. Our combined company will be the second largest North American video rental company with annual revenue of approximately $2.6 billion and approximately 4500 stores located in all 50 U.S. states, Canada and Mexico. With a broader geographic presence and greatly improved distribution capabilities and scale, our combined company will be a strong competitor, well-positioned for continued success in urban, suburban and rural markets.”