UPDATE: THQ's Jason Rubin has posted a lengthy note explaining the process of Chapter 11 bankruptcy, while simultaneously attempting to assuage any fears fans might have about the fate of the publisher's upcoming lineup. He specifically makes a point of comparison to MGM. MGM famously ran into financial issues a couple of years back, and Chapter 11 bankruptcy turned out to be the production studio's savior, allowing it to fund two of this year's biggest films in the James Bond sequel Skyfall, and Peter Jackson's first Hobbit film. Of course, it also allowed MGM to release that abhorrent Red Dawn remake, AKA the movie most directly comparable to a franchise in THQ's lineup, but I suppose that wasn't really Rubin's point.
You can read his entire post here.
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THQ is bankrupt, and has a new owner. Yes, all at the same time.
Clearlake Capital Group LLP has acquired the financially beleaguered publisher as a "stalking horse bidder," offering up a total consideration of $60 million for the company, including a new $10 million note for its creditors.
The bankruptcy petition by THQ is simply a byproduct of this larger deal, allowing the company to shed some of its debt obligations in the wake of the sale.
According to a press release put out by THQ today announcing the deal, the company made it clear that it has every intention of continuing development on its upcoming suite of games, including the likes of Metro: Last Light and South Park: The Stick of Truth.
"The sale and filing are necessary next steps to complete THQ's transformation and position the company for the future, as we remain confident in our existing pipeline of games, the strength of our studios and THQ's deep bench of talent," said Brian Farrell, Chairman and CEO of THQ. "We are grateful to our outstanding team of employees, partners and suppliers who have worked with us through this transition. We are pleased to have attracted a strong financial partner for our business, and we hope to complete the sale swiftly to make the process as seamless as possible."
In case you're anything like I was prior to writing this story and don't really understand what a "stalking horse bidder" even is, it turns out it's simply a method of auctioning assets that ensures THQ wouldn't be low-balled by potential bidders. By filing for Chapter 11 bankruptcy, THQ was able to use the stalking horse method to select Clearlake as an opening bidder for the publisher. Any other company could have entered the fray and bid up over Clearlake, but it sounds like nobody did. In effect, THQ chose its eventual owner, while leaving the door open for other bidders who never appeared.
Kind of an interesting story to just float out there right at the end of the year, when all the media is beginning to disappear for vacation, ain't it?
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