End Row: THQ files for Chapter 11

Posted Thu Dec 20, 2012 at 07:00 AM PST by
THQ Bankruptcy and Sale

Clearlake Capitol Group injecting $60 million in exchange for the publisher's remnants.

According to Gamasutra, the bankruptcy and acquisition may allow THQ's remaing studios, Vigil, Relic, Volition, and THQ Montreal to escape the publisher's $100 million debt, "With today's Chapter 11 filing, the company is hoping to deal with those obligations. A still unnamed investor, who is working through Clearlake Capital Group, has promised to fund the company's continued development of its games to the tune of $50 million. (And it's important to note that Clearlake isn't the entity buying THQ's assets. They're the corporate equivalent of a middleman.)"

THQ's demise has become more and more public over the last year, but some have cited MGM as an a example of a company that THQ should look to for inspiration. From Polygon, "Rubin, who was appointed president of THQ in May, writes that the bankruptcy proceedings and investment from Clearlake represent a 'new start for our company.' THQ's Chapter 11 filing for restructuring is a 'safety net,' Rubin says to fans concerned about the gamer maker's future, noting that companies like Marvel Studios, General Motors, American Airlines, Macy's and MGM have sought similar protection.

"MGM filed Chapter 11 two years ago, and this year it released Skyfall and The Hobbit, two of the biggest titles of the year," Rubin argues. "That's what I mean when I say new start!"

In contrast to Rubin's optimism, Michael Pachter (quoted at Gamasutra) has generated some numbers that sound reminiscent of THQ over the last year. "if both games sell in the 2.5 million-3 million range, the company should be able to survive another year or so – with a focus on Desilets' 1666 as the next tentpole.

However, he notes, 'if South Park and Saints Row sell 300,000 units, these investors are going to lose their money.'"

One tangent of the dealings was the public confirmation of Patrice Desilets' '1666,' a title whose fate seems as vulnerable as ever. Patrice is known best as the Creative Director for the first two 'Assassin's Creed' games.

Source: Gamasutra

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Tags: 1666, Volition, Relic, THQ Montreal, Vigil (2 posts), THQ (17 posts) (all tags)