Liquidation sale now under way
HOULTON, Maine — Financial woes have hit here again in the County as one of the country’s largest movie and DVD rental chains, Movie Gallery, Inc. (MGI), starts shutting down operations of 15 locations in Maine.
Exact plans for liquidation in Houlton were unavailable at presstime. Sales Associate Raelynn Sargent, mother of two boys —12 and 9 — said she had “no idea about future employment” and will continue to work her hours. She said she only knew the projected closing was within the next six weeks and the store would be selling everything including fixtures. The manager was not available for comment.
The Presque Isle store, according to an employee who asked to not be identified, should remain open indefinitely. However, the Caribou location, according to a “manager on duty” has already started slashing prices to 40 percent off and will be open for another few weeks. Everything is on sale, he said, Blue-Rays, DVDs, cassettes, games and equipment.
Reportedly, Movie Gallery will close anywhere from 600-800 of some 2,200 stores nationally as it buckles under pressure from consumer alternatives like Netflix, You Tube and free-standing kiosks. The economic downturn, competing entertainment options and poor performing stores scrawled the handwriting on the wall. And, it was written in red ink. In 2006 MGI’s reported revenue was $2.5 billion.
According to a corporate statement, MGI filed a voluntary petition for reorganization under Chapter 11 of the United States Bankruptcy Code on Feb. 2 this year. “This action enables MGI to restructure its debt while continuing to operate the business. The filing does not include MGI’s Canadian operations, which continue business as normal,” said the statement in part.
“MGI’s restructuring also includes the liquidation and closure of a number of Movie Gallery, Hollywood Video and Game Crazy store locations. We are closing these stores because they are not profitable and because funds from liquidating them can help us moving forward.”
