Blockbuster and the hostile takeover of Hollywood Video

nneace

nneace

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My mom mentioned this to me, and I was wondering if anyone heard anything of this. She had said that Blockbuster was attempting a hostile take over of Hollywood Video, and that they had already accumulated 51% of Hollywood Video's shares. If this is true, would the GameCrazy's simply be taken over, or just closed? I remember a store where I live (I think it was a Funcoland type of store), was renting games along with selling new and used games. Well Wherehouse bought them out, and closed all their locations. Here is some tangible evidence that I found:

Linky #1

Linky #2

I wonder what this will mean?
 
I'd be pissed. I love my GC. I also love HV. I hate Blockbuster.. Whatever happened to good, healthy competition?
 
[quote name='Scorch']Whatever happened to good, healthy competition?[/quote]

It seems as though EA has set a new benchmark in video games. What is HV man?
 
[quote name='nneace'][quote name='Scorch']Whatever happened to good, healthy competition?[/quote]

It seems as though EA has set a new benchmark in video games. What is HV man?[/quote]

Hollywood Video.
 
[quote name='nneace'][quote name='Scorch']Whatever happened to good, healthy competition?[/quote]

It seems as though EA has set a new benchmark in video games. What is HV man?[/quote]

Well it's consolidation time, the time when video games are suddenly seen as a huge profit area. But I will be pissed as hell if BB buys out HV, it will mean more expensive rentals with less of a selection for me.
 
Yeah, I think this hostile take over steams from Blockbuster and the shady "No Late Fees Policy." With the lawsuit in the Garden State, I think this may be a two-fold corporate purpose. First to divert attention from their legal battles, and take out a corporate competitor in the process. What is unfortunate, is that it is all based on shares, and some billionaire (can't remember his name), owns half the shares of both Hollywood Video and Blockbuster. He suggested that Hollywood Video sell to Blockbuster. I will try to keep updated on the happenings.
 
i work at gamecrazy and we haven't been told anything about this.. guess there's a reason for that
 
Wow, that would be lame a hell is Blockbust took over HV. Where I live, I literally have a HV directly across the street from a BB. That would be weird for them to essentailly turn into the same store.
 
[quote name='spaceloaf']Wow, that would be lame a hell is Blockbust took over HV. Where I live, I literally have a HV directly across the street from a BB. That would be weird for them to essentailly turn into the same store.[/quote]

Yep, I know plenty of locations where 1 of the 2 stores would just be shut down. I figure if HW goes down I might just start renting from the local supermarket. Better location than BB and they do have cheap new releases.
 
[quote name='nneace']It seems as though EA has set a new benchmark in video games.[/quote]

Hmm, looks like corporations are getting idea's from Electronic Arts...:wink:
 
[quote name='SEGA128DC'][quote name='nneace']It seems as though EA has set a new benchmark in video games.[/quote]

Hmm, looks like corporations are getting idea's from Electronic Arts...:wink:[/quote]

..are you suggesting that, throughout time, EA is the only company to ever have the idea of buying out its competition!?
 
I read a more recent article in either the Washington Post or NY Times. Blockbuster is indeed attempting to take over HV, but HV is attempting to be bought out by Movie Gallery, a chain here in the South that I am not sure is elsewhere. Though HV is a pretty cool store, they have been losing money for years. It may even go out of business if the either one of these mergers does not happen. HV also thinks if BB tries to buy them , the govt will step in to prevent antitrust issues.

We don't have a GR or a GC! I have no idea of the untold wonders of those places!
 
[quote name='Scorch']..are you suggesting that, throughout time, EA is the only company to ever have the idea of buying out its competition!?[/quote]

No, of course not. I'm just poking fun at Electronic Arts. Why are you always defending EA?...:whistle2:k
 
[quote name='SEGA128DC'][quote name='Scorch']..are you suggesting that, throughout time, EA is the only company to ever have the idea of buying out its competition!?[/quote]

No, of course not. I'm just poking fun at Electronic Arts. Why are you always defending EA?...:whistle2:k[/quote]

Why do you always attack them? Let me explain why: Because we all have opinions.
Good for Blockbuster. It's survival of the fittest, my ninjas.
 
[quote name='SEGA128DC'][quote name='Scorch']..are you suggesting that, throughout time, EA is the only company to ever have the idea of buying out its competition!?[/quote]

No, of course not. I'm just poking fun at Electronic Arts. Why are you always defending EA?...:whistle2:k[/quote]

LOL Scorch always defending EA?

IIRC Scorch was one of the first people here to have an anti-EA signature up for awhile around the time of the whole EA/NFL garbage.
 
[quote name='The Truth']Why do you always attack them? Let me explain why: Because we all have opinions.
Good for Blockbuster. It's survival of the fittest, my ninjas.[/quote]

I attack Electronic Arts simply because they are hurting the video game industry, which I care about...
 
[quote name='SEGA128DC'][quote name='The Truth']Why do you always attack them? Let me explain why: Because we all have opinions.
Good for Blockbuster. It's survival of the fittest, my ninjas.[/quote]

I attack Electronic Arts simply because they are hurting the video game industry, which I care about...[/quote]

I think they are helping the industry, and I realize that is not a favorable opinion at this Web site.
All I mean is, respect his opinion, just as I respect yours and i hope you will respect mine to disagree with it.
 
i will probably get flamed for this:

you can check out dvds free at your local library. get your dvds there instead of paying money at BB or HV.

As for Gamecrazy and gamerush, just keep shopping their deals, if one of them goes under, it would suck but not be the end of the world. I always figured that Gamerush would be the store to go bankrupt bc of all their crazy ass deals.
 
[quote name='nneace']Yeah, I think this hostile take over steams from Blockbuster and the shady "No Late Fees Policy." With the lawsuit in the Garden State, I think this may be a two-fold corporate purpose. First to divert attention from their legal battles, and take out a corporate competitor in the process. What is unfortunate, is that it is all based on shares, and some billionaire (can't remember his name), owns half the shares of both Hollywood Video and Blockbuster. He suggested that Hollywood Video sell to Blockbuster. I will try to keep updated on the happenings.[/quote]

No, this began long, long before the 'No Late Fees' campaign. BB first made an offer to HV over a year ago.

EA is not the model to consider here. Think instead of the awful HP buyout of Compaq. Disastrous and ill-conceived as that procedure was, it had some real concerns about the future of the two companies' core businesses. Unlike almost any other comparable product the PC business has to compete with guys working out of their garages, assembling machines to order. A lot of cost goes into having a big brand name and all the infrastructure that goes with it. Yet I know of several small city governments here in SoCal whose only brand name computers are servers.

The HP and Compaq leadership thought they had a better chance of surviving as one entity against everybody else than as separate companies. It might have worked if they weren't in direct competition on so many fronts.

The video store business is in a similar state. Conditions are changing from when the affordable VCR brought their business into existence. It has become increasingly hard in the era of DVD and growing video-on-demand options to justify renting instead of buying discounted DVDs or ordering the movie from your cable/satellite provider and storing it on a DVR to be watched at the consumer's convenience. At the same time the structure of their outlets isn't well suited to competing with the likes of Best Buy. They lose more business to outright purchases at the other BB than they do to HV.

Blockbuster isn't entirely sure what they'll be five years from now but if it involved B&M locations then consolidating the field under their brand is an important step. At the least, it will hold off the final collapse a bit longer.
 
you may be pissed about this now, but wait till Blockbuster secretly buys over half of EA's stock and becomes the majority share holder and takes over the company... that is when i shall run the streets naked screaming OMFG PWNZOR!1
 
[quote name='sblymnlcrymnl']Hollywood Video sucks ass anyway.[/quote]
I agree. For 21.99 a month I can get unlimited game rentals, ONE game at a time.
 
gesh we just got a Hollywood Video here (they built a new building for it) and its pretty much next door to Blockbuster. If the buy out happens I wonder which location they will close down.
 
[quote name='CapAmerica']gesh we just got a Hollywood Video here (they built a new building for it) and its pretty much next door to Blockbuster. If the buy out happens I wonder which location they will close down.[/quote]

The bigger one will be a Blockbuster and the smaller will become a Starbucks.
 
I've always liked HV over BB. Mostly because selection was much better and you were able to keep anything you rented for 5 days. Whether it be new realase or not.
Unlike BB who really only gave u 1 day. And even with "No Late Fees" they still come around and try to rip you a new one.
 
sorry but hollywood video does suck. they may have more selection but their stores are a mess so how do you find any of them??? and don't knock the no late fees program until you understand it. besides blockbuster has been trying to buy them out for quite some time, totally nothing to do with no late fees...
 
[quote name='WeaponX2099']I rent DVD's for 1 buck at HV. Where else can I do that?[/quote]

How do you get $1 rentals there?
 
I swear the people who make the decisions for Blockbuster need to die.

In the two years I worked for Blockbuster I remember saying to myself pretty much every day; when has any corporate decision made any sense?? Oh well, I guess when you're just that freaking rich and powerful you can never be wrong.
 
The following was on Yahoo! News a few days ago. Blockbuster threw in the towel.

DALLAS - Blockbuster Inc., the nation's leading movie-rental chain, abandoned its bid Friday to buy rival Hollywood Entertainment Corp. amid opposition from the smaller company's directors and resistance from federal antitrust regulators.

Instead, Hollywood is all but certain to be acquired by Movie Gallery Inc., the nation's largest third-rental chain, creating a new and larger No. 2 competitor to Blockbuster.

Dallas-based Blockbuster let its hostile bid for Hollywood shares expire Friday and said it would not extend the offer.

"Our decision not to extend our offers was reached after a careful review of all of the available facts and circumstances," Blockbuster chief executive John Antioco said.

Blockbuster had offered $14.50 in cash and stock per share, or about $985 million for all of Hollywood's shares and options. Movie Gallery offered $13.25 cash per share, or about $900 million.

The price difference between the bids, however, was not as crucial as the fact that Movie Gallery won swift antitrust approval while Blockbuster ran into problems at the Federal Trade Commission.

Blockbuster conceded that it was unlikely to resolve hurdles at the FTC before Hollywood shareholders vote on the Movie Gallery bid April 22. The company had grown more pessimistic about overcoming FTC objections after a brief and futile meeting with regulators in Washington two weeks ago.

Larry Denedy, a spokesman for Hollywood, said of Blockbuster's retreat, "This is what we had said all along, that we thought (Blockbuster's bid) was going to run into problems."

The FTC had worried that a Blockbuster-Hollywood combination would have too much power over rental prices — the agency killed a Blockbuster-Hollywood deal in 1999 on similar grounds. Blockbuster, however, argued that the FTC failed to consider competition that its stores face from online rental services such as Netflix Inc. and from cheap DVDs sold at discount stores.

"It was always an uphill battle, given the number of stores (Blockbuster) already had," said Arvind Bhatia, an analyst with Southwest Securities in Dallas.

The combined Movie Gallery-Hollywood chain will have about 4,500 stores and annual revenue of $2.6 billion, second only to Dallas-based Blockbuster, which has nearly 5,800 U.S. stores and $6 billion in revenue.

Thomas Johnson, a spokesman for Dothan, Ala.-based Movie Gallery, said his company would continue to operate Hollywood as a separate chain with larger stores than Movie Gallery locations, many of which are in smaller communities.

Johnson said the acquisition would not result in store closings or layoffs.

"We probably will bring a little more financial discipline, focusing on being a low-cost provider," Johnson said. He said the new company would have more purchasing power to get better deals from suppliers.

Bhatia said shares of Hollywood and Blockbuster were likely to fall when trading resumes Monday. U.S. markets were closed Friday for the Good Friday holiday. Hollywood shares closed Thursday at $14.13, well above Movie Gallery's $13.25 per share bid, which is now the only offer before shareholders. Blockbuster shares ended Thursday's session at $9.46, while Movie Gallery's stock traded at $24.06.

From the start, Hollywood's board had opposed Blockbuster's bid and refused to let Blockbuster view financial information. Hollywood said the Movie Gallery bid was better because of likely regulatory opposition to a deal with Blockbuster.

In a twist earlier this week, Hollywood's founder and former CEO, Mark Wattles, had indicated he wanted to buy up to half the Hollywood stores, which could have helped pave the way for Blockbuster's bid to succeed.

Steve Axinn, Movie Gallery's antitrust lawyer, called Wattles' offer a "last-ditch effort" to salvage Blockbuster's bid, but said it would not have been satisfactory to the FTC.

FTC officials declined to comment Friday.
 
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