Judge organises auction to sell off THQ assets individually.
The ongoing saga of THQ’s financial woes took a surprising turn last night, as VG247 and Joystiq reported that an auction would take place on Tuesday, 22nd January placing the struggling publisher’s various intellectual and physical assets for sale.
The new action stems from a court case investigating the takeover of THQ by Clearlake Capital Group, who gobbled up the company last month and immediately put them up for sale at $60 million dollars. As part of the deal THQ declared themselves bankrupt radically reducing their alleged $100 million dollars owed to creditors to just $10 million.
Now this is where proceedings get a little confusing so stick with us on this one. The deal between THQ and Clearlake needed to be approved by stockholders and the US courts in order to continue, but the stockholders argued that the 30-day approval window for the deal wasn’t adequate enough to allow other potential bidders to get involved. At the same time THQ’s creditors were negotiating with Clearlake Capital in order to try to work out a deal where both parties would be happy with the percentage of debt THQ paid back to those parties that leant them money.
With one party looking to pay as little debt back as possible while the other was looking for the most amount of money back negotiations between both parties broke down, which forced the judge presiding over the case, Judge Mary F. Walrath, to set an auction date of Tuesday, 22nd January where THQ’s assets will be sold off on a piece by piece basis; this includes studios, licensing deals, intellectual properties – the whole kit and caboodle.
Now this doesn’t necessarily mean that THQ will be broken up, as an investor could swoop in on that auction day and buy up every asset; a bit like what happened with Warner Bros. snapping up Midway when they went through similar financial heartbreak, but even then some properties and studios were canned or left behind.
It’s unclear what will happen in two weeks time, but there are rumours circulating that EA, Warner Bros. and Ubisoft are looking at this ongoing THQ saga very closely.
No doubt this story will continue to developer over the coming days and weeks, so be sure to check back for more updates.
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