Blockbuster amends offer.
Movie Gallery appears to be moving closer in its bid to acquire video rental chain Hollywood, while Blockbuster continues to upgrade its rival offer.
Movie Gallery said today (Feb. 14) that it has regulatory clearance to go forward with the acquisition. Movie Gallery's bid for Hollywood is $13.25 per share in cash, for a total of $1.2 billion.
Blockbuster, meanwhile, said Friday that it would pay $225 million cash for Hollywood’s long-term debt. The offer will expire March 11, the same date Blockbuster's cash offer for Hollywood's shares at $11.50 apiece expires.
Blockbuster previously filed a statement with the Securities and Exchange Commission saying that it intended to purchase Hollywood for $14.50 a share, or a total of more than $1.3 billion.
According to Movie Gallery, Blockbuster’s proposed offer is under investigation by the Federal Trade Commission. Additionally, Movie Gallery reports that Blockbuster received a "request for additional information" from the FTC in connection with its Hollywood proposal and that Movie Gallery did not receive a similar request.
Blockbuster did not return a call seeking comment.
Hollywood’s shareholders will vote on the Movie Gallery proposal Feb. 16. The board of directors is supposed to announce which offer it is backing Feb. 17.