THQ Bankruptcy Case Ends

[StewShearerOld]

THQ Bankruptcy Case Ends

THQ's unsecured creditors will recover between 20-52% what they're actually owed.

THQ's infamous bankruptcy case may finally be coming to a close. Judge Mary Walrath has approved a liquidation plan that will see THQ's unpaid creditors reimbursed with a large chunk of the proceeds from the recent auction of the now defunct publisher's assets. The auction in question raised about $72 million in addition to another $6.55 million earned from separate sales conducted in the month of April. That being the case, the funds from the auction don't even begin to cover the total claims from debtors which range between $143 to $183 million. Depending on the sizes of their claims and other pertinent factors, unsecured creditors involved in THQ's case will likely only receive 20-52% of the amount that they're actually owed.

THQ filed for <a href=http://www.escapistmagazine.com/news/view/121188-THQ-Files-For-Chapter-11-Bankruptcy>chapter 11 bankruptcy in December of 2012. Following the announcement, it attempted to enter into a purchase agreement with Clearlake Capital Group, which would have allowed the company to continue current operations under new ownership. Unfortunately, its <a href=http://www.escapistmagazine.com/news/view/121341-Lenders-Object-to-THQ-Bankruptcy-Sale>creditors objected, basically arguing that the game publisher was worth more dead than alive. Judge Walrath <a href=http://www.escapistmagazine.com/news/view/121375-Judge-Denies-THQ-Bankruptcy-Sale-UPDATED>agreed and THQ's assets were sent to the <a href=http://www.escapistmagazine.com/news/view/121680-Bankruptcy-Auction-Ends-THQ>aforementioned auction where its competitors were able to pick up the rights to studios and franchises including Metro: Last Light, Homefront and Darksiders. All in all it's been sad to see THQ, founded in 1989, wind up in such dire straits and while the end of its bankruptcy case isn't likely to make many people happy, hopefully it can bring the situation to final closure.

Source: <a href=http://www.bloomberg.com/news/2013-07-16/thq-gets-approval-of-liquidating-plan-ending-bankruptcy.html>Bloomberg

Note: In the original article we mistakenly said unsecured creditors would only receive 20-25% of what they were owed. In actuality the source piece said 20-52%. We apologize for any confusion.





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[SweetWarmIce]

I always liked THQ. The whole situation was a shame but at least now it's over.

 

[PBMcNair]

I wonder how much they'd have gotten if the sale to Clearlake went ahead ?
Still, at least its all done now.

 

[Zeckt]

I remember THQ quite fondly, when the PS2 launched and every game was complete garbage EXCEPT the summoner with the promise of the first red faction on the way with fully destructable enviroments that they actually delivered on and then some. Thanks for making the early days of the PS2 worth a damn thq, you will be missed.

 

[RJ 17]

I'm just glad someone picked up the Darksiders franchise. I don't care what anyone says, I enjoyed the games. While the fact that it's Nordic Games who traditionally does everything on the cheap-cheap isn't encouraging, at least there's still a sliver of hope for a new installment...even if it'll be a few years before that hope can even begin to be realized.

 

[008Zulu_v1legacy]

Idiot creditors and judge. The whole was worth far greater than the sum of it's parts.

 

[walrusaurus]

Idiot creditors and judge. The whole was worth far greater than the sum of it's parts.

Ya but US corporations in the modern era are only ever concerened w/ next quarters numbers. While, yes allowing THQ to turn their business around and and repay their debts over time would have resulted in a much greater return for them, it wouldn't do jack-diddly for their 2013 earnings report and thus no fat bonus for the folks in charge. The entire american corporate system has been conditioned to disregard long term investment, and -unfortunately- consequences.

 

[LordMonty]

wonder if they really made that much more cash breaking THQ up? ahh well rest in pieces THQ.

 

[Yagami_Kira]

I wonder how much they'd have gotten if the sale to Clearlake went ahead ?
Still, at least its all done now.

37.5m was the amount Clearlake would have purchased for.

 

[Little Gray]

I wonder how much they'd have gotten if the sale to Clearlake went ahead ?
Still, at least its all done now.

The bid from Clearlake was for $60 million.

Idiot creditors and judge. The whole was worth far greater than the sum of it's parts.

Ya but US corporations in the modern era are only ever concerened w/ next quarters numbers. While, yes allowing THQ to turn their business around and and repay their debts over time would have resulted in a much greater return for them, it wouldn't do jack-diddly for their 2013 earnings report and thus no fat bonus for the folks in charge. The entire american corporate system has been conditioned to disregard long term investment, and -unfortunately- consequences.

Clearlake was not going to buy THQ they were going to buy all of THQ's assests. That means that they would not have been taking on any of THQ's debts and the creditors would have been left with even less money.

 

[Pyrian]

Clearlake was not going to buy THQ they were going to buy all of THQ's assests. That means that they would not have been taking on any of THQ's debts and the creditors would have been left with even less money.

I dunno about that. I mean, obviously $60 million is less than $78 million, but $60 million is more than $183/4=$46 million. Why the difference? $78 million may be what the assets sold for, but that's not what the creditors are getting. I don't know exactly where all of that $32 million (or more) difference is going, but "lawyers" is a pretty good bet.

The $60 million would've almost certainly been a cleaner deal. (Assuming everything written here is true; I haven't verified any of the claims made by the article or the posters.)

 

[Little Gray]

Clearlake was not going to buy THQ they were going to buy all of THQ's assests. That means that they would not have been taking on any of THQ's debts and the creditors would have been left with even less money.

I dunno about that. I mean, obviously $60 million is less than $78 million, but $60 million is more than $183/4=$46 million. Why the difference? $78 million may be what the assets sold for, but that's not what the creditors are getting. I don't know exactly where all of that $32 million (or more) difference is going, but "lawyers" is a pretty good bet.

The $60 million would've almost certainly been a cleaner deal. (Assuming everything written here is true; I haven't verified any of the claims made by the article or the posters.)

I will give you a little piece of advise. This article on the escapist is completely fucking useless. They cherry-picked lines from the Bloomberg article without regards to context and made up some of their own stuff as well. If you want the actual facts look up the Bloomberg article. That 20-25% number was actually just pulled out of somebodies ass to get more hits its not based on facts.

 

[KingWein22]

I am still going to miss THQ. Sure, they have had their fair share of bad games, but I liked their WWF/WWE games.

 

[Soviet Heavy]

THQ is the sad ur example of biting off more than you can chew. They had a number of quality titles and a strong group of developers, but they overestimated their reach. They wanted to play in the big leagues with EA and Activision, and their games suffered for it. Space Marine was forced to go up against fucking Gears of War 3 for god's sake. I don't deny that the Warhammer 40K license is lucrative, but you were challenging the king of 3rd person shooters.

Homefront was pretty much a failure on all fronts (especially the home one), and the U-Draw tablet to try and challenge Nintendo was just the deathbell.

 

[Something Amyss]

wonder if they really made that much more cash breaking THQ up? ahh well rest in pieces THQ.

Belabouring a sale with an all-or-nothing wager would likely drive the overall cost down. Time was not an asset here.

At least none of it is going to Rhode Island =/
Thanks
Have a
Quarter.

Zachary Amaranth likes this post (thumbs up image)

 

[Something Amyss]

THQ is the sad ur example of biting off more than you can chew. They had a number of quality titles and a strong group of developers, but they overestimated their reach. They wanted to play in the big leagues with EA and Activision, and their games suffered for it. Space Marine was forced to go up against fucking Gears of War 3 for god's sake. I don't deny that the Warhammer 40K license is lucrative, but you were challenging the king of 3rd person shooters.

Homefront was pretty much a failure on all fronts (especially the home one), and the U-Draw tablet to try and challenge Nintendo was just the deathbell.

I don't think you mean "ur example." That would be Atari, most likely. In fact, the industry biting off more than it could chew was pretty common in the 80s, and led to a crash. Modern companies are doing it, too. When they're making games that can't "merely" sell 5-7 million units and be successful, something's wrong. However, THQ's mistake was to gamble on physical stock, much like the early 80s examples.

Really, they're less am Ur example than a "continuation of a long and well-traveled road of stupidity" example.

Also, the uDraw wasn't to "challenge Nintendo."

I am still going to miss THQ. Sure, they have had their fair share of bad games, but I liked their WWF/WWE games.

WWE '15 will likely be a very good game, once they've gotten rid of the transition year.

Plus, we might finally get rid of some of the assets that have been recycled since the early PS2 days.

 

[Eddie451]

THQ can finally rest in peace, goodbye THQ, you were one of the best.

 

[porous_shield]

When the article says "6.55" million in sales in the month of April do they mean games sales by THQ like over Steam and whatnot? Over twelve months that would be close to 80 million and more than they got from the sale of THQs assets.