Movie Gallery co-founder resigns
Malugen was replaced as CEO in May
By Danny King -- Video Business, 8/5/2008
AUG. 5 | Movie Gallery said today that co-founder and former CEO Joe Malugen resigned from the company’s board of directors last week as the No. 2 movie-rental chain continues to overhaul its senior management since exiting bankruptcy less than three months ago.
Malugen
Malugen, who in May was replaced as CEO by C.J. “Gabe” Gabriel and as president by Neil Subin, stepped down from the board July 28, Movie Gallery said in a statement. Longtime executive S. Page Todd also resigned last week.
Malugen co-founded Movie Gallery with Harrison Parrish in 1985 and took the company public nine years later. The company’s $1.2 billion acquisition of Hollywood Entertainment in 2005 weighed down Movie Gallery with debt and helped take it into bankruptcy last year. The company, which filed Chapter 11 in October, has closed more than 1,000 stores since September.
Additional recent management changes include chief operating officer Sherif Mityas, who joined the company in June, and Lucinda “Cindy” Baier, who replaced Thomas Johnson Jr. as Movie Gallery’s chief financial officer two weeks ago.
The company emerged from Chapter 11 on May 20 with about 3,300 stores in the U.S. and Canada under Movie Gallery, Hollywood Video and Game Crazy brands. The debt Movie Gallery incurred to acquire Hollywood Entertainment, coupled with changes in the industry such as the increased competition between Blockbuster and Netflix over mail-order rentals, were key factors in leading Movie Gallery, once a thriving rental chain catering to small- and mid-size markets, into its bankruptcy.
