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Bankruptcy court approves Movie Gallery financing
Bankruptcy |
2007/10/18 03:22
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| Movie Gallery Inc. received approval during its first appearance at the U.S. Bankruptcy Court late Tuesday to access financing from lenders and to pay employees and vendors. In the company's first court date after filing for bankruptcy, the court approved access to $140 million of its $150 million financing facility and gave permission to use cash generated from daily operations to continue to pay vendors and employees as Movie Gallery proceeds with its financial restructuring. "We are pleased with the prompt action by the bankruptcy court in approving our first day motions," CEO Joe Malugen said. "This approval will allow our stores to continue to operate so that we can continue to serve our customers while implementing strategies to enhance our financial performance." Movie Gallery's Canadian operations were not included in the filing. The final hearing about its financing from creditors is scheduled for Nov. 6. The company announced in September plans to close 520 unprofitable stores across the country, including 14 in Alabama. It also entered into a restructuring program to reduce $1 billion debt incurred after buying the Hollywood Video chain in 2005. |
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