THQ Simultaneously Files Chapter 11 Bankruptcy, Secures Buyer for Company's Assets [UPDATED]

"Clearlake Capital Group LLP has acquired the financially beleaguered publisher"

Oh that doesn't sound too good.

Why are people talking about buying the rights to Saint's Row and all that? What's the indicator that there won't be another one?

Man, this sucks but everyone saw it coming from a mile away. At least the studios are still open and there's still a chance for the company to turn itself around. Here's to hoping!

I only care about relic and their golden egg HOMEWORLD

@csl316 said:

Just gimme Red Faction: Guerilla 2 somehow.

Never gonna happen.

It's weird to put "bankrupcy" and "good news" together like this, but that's the business world I gather. Good to know that their line-up is still on track at the very least, and hopefully will be strong enough to bring THQ back from the brink.

The THQ Humble Bundle makes a whole lot more sense now, the publishing rights to all of THQ's existing games are going to be lost now and will probably never go on sale again, I'd imagine anyone with extra keys for that is sitting pretty now.

What I don't understand is how a company can legally write off all its debt and then be sold of debt-free (or reduced debt) with out the new owner having to take on those debts as part of buying the company. What happens to the creditors? If anyone more business-minded can explain this I would be pleased.

I remember before Mass Effect 3 came out I was hoping The Old Republic didn't sink Bioware before ME3 was released. Now my friend is hoping THQ doesn't sink before Metro Last Light comes out. Video games.

I will fund Saints Row 4 with the £20 note in my hand.

@theodacourt said:

If this means THQ carry on as usual then I'm all for it. Whoop!

THQ doing this essentially made it possible for the scenario you mentioned to happen, so YES.

Come on South Park game! come out in good shape.

So, what does this actually mean? I don't quite get it. Are they done? Are they safed? What about Metro Last Light, Southpark and Company of Heroes 2?

seems kind of a low amount of money for the company, at least they'll stay afloat and finish some games in development.

now's the time to buy THQ stock yo, it dipped to about 40 cents a share and if your confident in the upcoming games, it might be a good deal :P

As long as Saint's Row 4 is made, I will be happy.

@leebmx: As a bankruptcy attorney I get questions like this quite a bit. Chapter 11 bankruptcy is a complex beast, and the Federal Bankruptcy Code demands that the debtor (the person or entity filing bankruptcy, THQ in this instance) file it's financials to show what its operating income and expenses are. The chapter 11 plan is based on what THQ can afford to pay in to the bankruptcy plan each month. Creditors get to vote on the plan and it can't generally be approved unless the creditors approved it.

In this case it sounds like a pre-pack chapter 11 was used. This is a type of chapter 11 where you plan it out with the creditors before hand.

You might ask why a creditor would go along with such a plan instead of suing out their debt, obtaining a judgment and trying to seize assets based on their judgment. Creditors will almost always find that they will receive more money through a bankruptcy plan than had THQ just shut down since their assets are probably all secured by loans. Assets that are secured by loans must go to the secured creditors. It's not like any creditor can seize any asset they want with a judgment. The creditor that has the security interest gets the asset.

Sometimes bankruptcy plans include selling assets to fund a plan, other times it doesn't. From the very limited information I have on this bankruptcy it sounds like THQ gets to keeps it's licenses and will continue development. Once the chapter 11 plan is completed the debt that isn't paid back is discharged.

The chapter 11 plan can be short, could be a lump sum payout, or it can stretch out over years. It all depends on what the creditors will accept in a plan.

Expect a little rough patches over the next few months, lay offs, key changes and then it should be all uphill from here basically for THQ, glad they aren't done and found a buyer

EDIT: Umm nevermind? I guess? I'm not really sure what this means from reading at other sites. My understanding was that they found a buyer to keep THQ intact (somewhat) everywhere else is reporting they are selling everything, don't know what to believe I guess.

@RetroVirus said:

As long as Saint's Row 4 is made, I will be happy.

This!

This is from the gamasutra article:

Troubled game publisher THQ is handing over its U.S. operations to a new owner.
Clearlake Capital Group is fronting $60 million to acquire THQ's business, including its four U.S. development studios (Vigil, Volition, THQ Wireless and THQ Phoenix). In order to facilitate the sale, THQ filed for Chapter 11 bankruptcy on Tuesday.

Which is interesting, that is US studios only. Meaning they did not acquire Relic since its only a US bankruptcy.

GOD DAMMIT THQ DON'T YOU DIE ON ME!

@Seedofpower said:

"Clearlake Capital Group LLP has acquired the financially beleaguered publisher"

Oh that doesn't sound too good.

Uhh, maybe you should read the article then.

Just make it to Saints Row 4 please, but all your other games I will buy to they all look cool.

Good for them, hope they get back in good financial standing. They make some unique things with their dev studios, and it'd be a shame to lose them.

I really thing Square Enix would have been a good fit and would have helped mold that company into the next sort of Rockstar. They are really good at promoting western games now, even better than it's own Japanese games. Interesting but hope that there are no layoffs especially around the holidays.

Short of them having suddenly exploded into profitability, this is possibly the best thing that could've happened to THQ. Hopefully the eventual new owner won't cock things up.

@jta04: Dude. Great sum up. Thanks. (not that it will stop the contingeint of those who don't want to read/or choose not to (or can't) comprehend.)

Darksiders, Saints Row, Metro, SP: Stick of Truth, Warhammer, and Geo-Mod technology: this company still has gold, and for some reason couldn't seem to capitalize on it.

An inevitable bummer - all news was leading to this for close to a year now. It'd be amazing if THQ persevered somehow, and came out of this mess better than ever, kicking ass and taking names, but even if that's in the cards, it won't be for a very long while. They've hit a recession of their own - let's hope Clearlake and the future games keep them afloat long enough to pull themselves out of this mess.

Also, they need to host a uDraw burning party, as a symbol of them moving on, or something. Really, all I want to see is a bunch of burning plastic.

@bingbangboom said:

I really thing Square Enix would have been a good fit and would have helped mold that company into the next sort of Rockstar. They are really good at promoting western games now, even better than it's own Japanese games. Interesting but hope that there are no layoffs especially around the holidays.

haha I don't think so....

Please don't let this fuck up Metro.

Please don't let this fuck up Metro.

Please don't let this fuck up Metro.

@thabigred said:

GOD DAMMIT THQ DON'T YOU DIE ON ME!

damn you Rubin! You were supposed to fix this!

...o snap i need to preorder CoH2 so the new owners don't fuck it up!

What is weird about this is that PE typically runs away from deals like this. I am curious if clearlake plans to flip it in ~2 years or actually make operational improvements. Either way, after looking at #s, $60 mil is generous.

Also, it would have been awesome to work at Clearlake on this deal because they probably did a site visit during due diligence to make sur those games are actually being made (early look at saints row, anyone?)

The South Park game is doomed if they are only mentioning doing all they can in releasing Company of Heroes 2 and Metro 2.

Surely SOMEONE has to pick that up.

WWE 14 will also be doomed. We will never ever see an improvement on Triple H's hair.

Damn YOU uDRAW!

I find it this article especially amusing, as the comments are split evenly between "I didn't read the actual article, just the title, this is clearly the end of days" and "what the fuck kind of financial wizardry are they pulling off right now".

@RonnieBarzel: I think this may be one of those cases were the buyer is a company that just buys companies on the cheap for the purposes of getting them to a point where they can be sold off again at a higher price*. They likely have no one who knows how to run a games company. They're just lawyers and accountants doing business deals.

*THQ used to be valued at $2 Billion so a $60 Million purchase is cheap and has potential for huge profit if they can rebuild the company with minimal financing.

@Terramagi said:

I find it this article especially amusing, as the comments are split evenly between "I didn't read the actual article, just the title, this is clearly the end of days" and "what the fuck kind of financial wizardry are they pulling off right now".

It's really amazing how few people on Giant Bomb have the most basic reading comprehension, I am baffled. This is how people end up buying things like WarZ with all the negative hype leading up to it's release.

People of Giant Bomb: This means THQ is out of debt, have new money and a new owner, but are at least for now continuing to operate the same. That means they will still be publishing games, and Metro, South Park, Company of Heroes, and presumably more will still be released! Calm down!

I just want a proper Red Faction sequel that builds on Red Faction Guerrilla... and Saints Row 4. Then all is well.

Actually, let me rephrase that: I just want the mad folks at Volition to continue making cool stuff.

I read through their bankruptcy petition. Turns out they owe $45,000,000 to the WWE.

I'm just worried aboyt Saints Row. 60m sounds very little for a game publisher. Saints Row 3 alone would have made more than that. They really must have done something really wrong.

@zeekthegeek: Relic wasn't part of the deal, so Company of Heroes 2 is very much in trouble if the game isn't already done; even more in trouble now as they don't have the rest of THQ to prop them up anymore and they are stuck with THQ's crippling debt problem.

Metro is in kind of the same boat, they weren't owned by THQ, but they aren't part of the deal either so they effectively have no publisher now yet the rights to the game are owned by a defunct company.

@themangalist: I think you are underestimating how much influence a board of directors has in any given company

@Brendan said:

@Seedofpower said:

"Clearlake Capital Group LLP has acquired the financially beleaguered publisher"

Oh that doesn't sound too good.

Uhh, maybe you should read the article then.

I did, and it doesn't address my concern.

I guess the $5 mil they got from the Humble Bundle wasn't enough....

Wikipedia says they lost 100 million dollars on uDraw. That was a completele waste of money.

"Filed under: THQ, Horse"

Wait, so is this a good thing or a bad thing? Is there going to be a Darksiders III or a Saints Row Goes Fourth? :u

@dagas: Hopefully with a new board of directors they won't make boneheaded decisions, like that one, anymore.