According to the statement, all of its stores are scheduled to close on or before July 31, 2010, with the exact timing of individual store closures to be determined on a store-by-store basis.
Unedited press release follows:
Movie Gallery Canada is Now Liquidating Merchandise in All of Its 181 Stores in Canada
TORONTO–Movie Gallery Canada, Inc. (the “Company”) has operated 181 stores under the “Movie Gallery” and “VHQ” banners in all provinces in Canada, with the exception of Quebec. The Company today announces that it will be liquidating inventory and other assets at all of its Movie Gallery and VHQ stores over the next six to eight weeks (the “Sale”). All of its stores are scheduled to close on or before July 31, 2010, with the exact timing of individual store closures to be determined on a store-by-store basis. A list of the closing stores is attached below.
Due to growing challenges in their markets, and other business concerns, the Company elected to file a Notice of Intention to Make a Proposal (“NOI”) pursuant to the Bankruptcy and Insolvency Act (“BIA”) on May 7, 2010. Under the NOI, A. Farber & Partners Inc. (“Farber”), a member of Farber Financial Group, was appointed as Trustee in the Proposal, and has been assisting the Company in this process.
The Company is not bankrupt and intends to file a proposal to its creditors, including landlords and employees, in the near future. The Company’s share of the net proceeds of the Sale will be used to fund this proposal to its creditors. In the meantime, the effect of the NOI and the Order of Ontario Superior Court of Justice dated June 11, 2010 is to provide an overriding stay of proceedings affecting all creditors until July 21, 2010, or thereafter if extended by the Court. The Company continues to occupy its leased premises, and to employ the majority of its valued 1,200 employees.
A joint venture group consisting of: Schottenstein Bernstein Corporation, Tiger Capital Group, and Hudson Capital Partners (the “Agent”) was selected by the Company to conduct the liquidation sale of the Company’s assets, comprising inventory and furniture, fixtures and equipment. This arrangement was approved by the Superior Court of Justice by Order of the Honourable Mr. Justice Campbell on June 11, 2010. The sale in 131 of the 181 store locations was commenced by the Agent on June 12, 2010 pursuant to that Order, affecting inventory valued at approximately $33,000,000.
On June 11th, the Company received offers from parties to acquire some of its remaining 50 stores, including inventory and assets therein. All such offers have been declined, and the Company has now decided to liquidate all 181 of its Canadian stores through its agreement with the Agent. The remaining 50 stores are to be added to the liquidation this week with an additional $15,000,000 of inventory and other assets for sale at significant discounts, including DVD and Blu Ray movies, video games and store fixtures.
“Consumer response to the initial liquidation sale has been excellent,” said David Peress, President of Hudson Capital Partners. “Customers are taking advantage of tremendous bargains on a great selection of movies, videos and games available for purchase at all Movie Gallery and VHQ stores throughout Canada. New product is arriving daily from Movie Gallery’s Canadian warehouse. All Company gift cards will continue to be honored during the Sale.”
Management, in concert with its advisors and Farber, intends to work as expeditiously as possible to maximize the outcome for the benefit of all stakeholders.
More information about the NOI process can be obtained by visiting Farber’s website at www.farberfinancial.com and clicking on the Movie Gallery Canada, Inc. link under Current Engagements.
About Farber Financial Group
Farber Financial Group (www.farberfinancial.com) provides specialty financial services for rescuing, refinancing and rebuilding businesses, including: corporate insolvency and restructuring, forensic accounting, fraud investigations, distressed financial advisory services, corporate finance, mergers & acquisitions, business strategy & valuations, turnarounds, CFO interim management and opportunity assessments. Farber is based in Toronto, Canada and is internationally a member of Begbies Global Network (www.begbiesgn.com).
About Schottenstein Bernstein Corporation
SB Capital Group, a Schottenstein affiliate, is a leader in the field of asset recovery, rescue finance, restructurings and store closing / event sales. With a portfolio of businesses and investments across a wide area of sectors including retail, consumer products, franchising, licensing and real property, SB Capital Group’s specialties include asset disposition services, acquisitions, financial solutions, as well as appraisal and valuation services. Please visit www.sbcapitalgroup.com to discover the many ways SB Capital Group helps businesses successfully manage change.
About Tiger Capital Group
Tiger and affiliated companies provide comprehensive advisory, valuation, auction, management, and disposition services for a broad range of retail, wholesale, and industrial companies. Over the past 30 years, we have managed more store closings than any other business in the industry and have provided inventory appraisals on behalf of a wide range of industries and merchants. Our focus is to help retailers, asset-based lenders and other financial institutions understand the underlying value of inventory and to provide key monitoring advice. To learn more about Tiger Capital Group, please visit www.tigercapitalgroup.com.
About Hudson Capital Partners, LLC
Hudson Capital Partners, LLC offers an extensive array of professional solutions to the challenges retailers face today, including management of excess, obsolete and discontinued inventory, changing geographic and demographic circumstances, unproductive store sites, and real estate and liquidity issues. The firm’s diversified staff is experienced at performing strategic store closings and relocations, fixed asset dispositions, wholesale inventory buyouts and lease mitigations. Through its advisory arm, HCP Asset Advisors, the firm provides appraisals and asset advisory services. To learn more about Hudson Capital Partners, please visit www.hudsoncpl.com.
Movie Gallery and VHQ Store Locations in Canada Street Address City Province 88 Howarth Street Red Deer AB 69 Dunlop Street Red Deer AB 266 4th Street Sw Medicine Hat AB 2034 19th Avenue Didsbury AB 5015 51st Avenue Eckville AB 104 2nd Avenue East Hanna AB 2-4601 50th Avenue Olds AB 80 Hewlett Park Landing Sylvan Lake AB 4921 50th Street Wetaskiwin AB 2347 & 2349 Rabbit Hill Rd. Edmonton AB 103-11030 100th Street Grande Prairie AB 106 Park Street Hinton AB #4800 Hwy 2a Ponoka AB 717 20th Street Ne Medicine Hat AB 6608 48th Avenue Camrose AB 5104 50th Avenue Cold Lake AB 83 Carry Drive Medicine Hat AB 5541 60th Street Vegreville AB 202 Main Street, Sw Slave Lake AB 5007 47th Avenue Taber AB 166 Columbia Blvd West Lethbridge AB 838 Main Street Pincher Creek AB 2300 Pine Plaza Grande Cache AB 17 Athabasca Avenue Devon AB 555 Main Street Cardston AB 11001 20th Avenue Blairmore AB 4325 50th Avenue St Paul AB #100-4300 South Park Drive Stony Plain AB 100-1040 Railway Avenue Canmore AB 5004 Dahl Dr. Whitecourt AB 110-800 Pine Road Strathmore AB 109-110, 10011 92nd St Grande Prairie AB 8802 100th St. Unit 17 Morinville AB 18352 Lessard Road Edmonton AB 102-9505 68th Avenue Grand Prairie AB 10004 Rainbow Blvd. High Level AB 3760 56th Street Wetaskiwin AB 5101 Broadway Ave. Blackfalds AB Bay 4, 6842-50th Ave Red Deer AB 4819-50th Avenue White Court AB 3708-50th Avenue Lloydminster AB 9902-93rd. Street Fort Saskatchewan AB 3121-49th Ave Red Deer AB 1-312 Cassils Road West Brooks AB 400-650 South Railway Ave. E Drumheller AB #6, 4502-50th Street Ponoka AB #002, 4302-50th Street Leduc AB 1066-11300 Tuscany Blvd. N.W. Calgary AB 101 Centre Street North Sundre AB 3566 Garrison Gate S.W. Calgary AB 6490 Old Banff Road S.W. Calgary AB 4923 47th Avenue Innisfail AB 9804 100th Street Peace River AB 4905 46th Street Bonnyville AB 10200 - 100th Street Westlock AB 4905-50th Avenue Barrhead AB 1111 10th Street Wainwright AB 1915 20th Avenue Coaldale AB Bay 101 5003 30th Ave Beaumont AB 4700 - 53rd Avenue High Prairie AB 8701 94th Street Fort Saskatchewan AB 5105-50th Street Drayton Valley AB 5040-50th Avenue Rocky Mountain House AB 5030 Highway 2a Lacombe AB 5028 50th Avenue Vermilion AB 330 45th Street, Unit 108 Edson AB 5500 Sunshine Coast Hwy #310 Sechelt BC 5301 - 25th Avenue Vernon BC 1-619 Vernon Street Nelson BC 9831-98a Avenue Fort St John BC 5101 South Access Road Chetwynd BC 470 Stuart Drive W Unit 7 Fort St James BC 1280 Cedar Avenue Trail BC B5-465 Merecroft Rd Campbell River BC 1800 Tranquille Road Kamloops BC 651 Main Street Lillooet BC 1-136 Tapton Avenue Princeton BC 3-192 West Island Highway Parksville BC 575 Old Hope Princeton Way Hope BC 9522 Main Street Winfield BC 665 Newman Road Quesnel BC 13-600 Mackenzie Blvd Mackenzie BC 4-4569 10th Avenue New Hazelton BC 2315 Beacon Ave. Victoria BC 845 Deloume Road Mill Bay BC 6638-6660 Sooke Road Sooke BC 2225 Guthrie Road Comox BC 2741 Forksdale Ave. Merritt BC 3350 10th Street Houston BC 460 - 5240 Domano Blvd Prince George BC 155 Malcolm Drive Quesnel BC 503 Hwy 16 Burns Lake BC 140-630 17th Street Castlegar BC 370 Proctor Street Williams Lake BC 1040 Alaska Avenue Dawson Creek BC 8950 Granville Street Port Hardy BC 145-149a City Centre Mall Kitimat BC 4296-D Joyce Avenue Powell River BC 101-1st Avenue East Prince Rupert BC 1323 Main Street Smithers BC 4730 Keith Road Terrace BC 112 1st Street West Vanderhoof BC 561 Highway 3 Fernie BC 5211 Airport Drive Fort Nelson BC 103-Highway 97 North 100 Mile House BC 240 Main Street Selkirk MB 886 Thornhill Street Morden MB 211 Saskatchewan Avenue West Portage La Prairie MB 35 Main Street Flin Flon MB 380 Hazelwood The Pas MB 247 Main St Steinbach MB 138 Main Street #11 Sussex NB 337 Connell Street Woodstock NB 210 King St St Stephens NB 15 A Du Vestiaire Street Shediac NB Sq. Mall - Columbus Drive Carbonear NL 76 Manitoba Drive Clarenville NL 42 Queen Street Stephenville NL 16 Murphy Square Corner Brook NL 1 Mt. Bernard Ave Corner Brook NL 3-153 Reserve Street Glace Bay NS 3737 Highway 3 Crowell NS 47 Paint Street #6 Port Hawkesbury NS 1016 Central Avenue Greenwood NS 31 Weaver Street Pictou NS 3290 Hwy 2 Fall River NS 86 Starrs Road Yarmouth NS #100, 314 Old Airport Rd. South Yellowknife NT 351 Scott Street Fort Frances ON 105 Peter Street Port Hope ON 29 Mission Rd Wawa ON 10 Superior Plaza Marathon ON 63 Main Street Grand Bend ON 313 Main Street East Kingsville ON 450 Garrison Road Fort Erie ON 281 Goodrich Street Port Elgin ON 372 Queen St. East Acton ON 12 Caradoc Street North Strathroy ON 120 Thames Street North Ingersoll ON 35 Sandwich Street South Amherstburg ON 159 Main Street East Grimsby ON 3 Arthur Street Arnprior ON 140 Queen Street Lakefield ON 97 Picton Main Street Picton ON 627 Fortington Street S. Renfrew ON 802 Main Street East Shelburne ON 3080 Highway 69 North Val Caron ON 220 Main Street North Exeter ON 316 Talbot St. North Essex ON 30 Queen Street South Tilbury ON 2135 Dorchester Road Dorchester ON 1 Pine Drive Parry Sound ON 9-206497 Highway 26 Meaford ON 825 10th Street Hanover ON 7 Commerce Road Angus ON 4610 Ontario Street Beamsville ON 4-60 Brunetville Road Kapuskasing ON 771 Pembroke St. East Pembroke ON 39 Chamber St Smith Falls ON 65 Van Horne Avenue Dryden ON 5 Chipman Street Kenora ON 141 Hastings St N Bancroft ON 229 Whitewood Avenue New Liskeard ON 341 Notre Dame Street Belle River ON 33 Wilson St Perth ON 800 Centre Street Espanola ON 98 La Fleche Blvd Unit 2 Casselman ON 1011 Victoria Street Petawawa ON 505 Granville St Summerside PE 1112 6th Avenue, Ne Swift Current SK 1591 100 Street North Battleford SK 506-508 Main Street Melfort SK 1200 8th St West Nipawin SK 815 Gray Avenue Saskatoon SK 503 La Ronge Avenue La Ronge SK 85 Government Rd. N.W. Weyburn SK 1310 7th St. Estevan SK 517 Main St. Kindersley SK 114 9th St. West Meadow Lake SK 1307a 8th Ave Humboldt SK 520 Central St. W. Warman SK