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US bankruptcy court clarifies bidding on THQ assets

US bankruptcy court clarifies bidding on THQ assets

Mon 07 Jan 2013 4:45pm GMT / 11:45am EST / 8:45am PST
BusinessPublishing

Updated: Electronic Arts named as another interested party as publisher opens up to being sold piecemeal

Update January 8:

The US bankruptcy court has confirmed that although THQs assets can be bought individually when they go up for auction on January 22, bids will only be considered if the value generated by separate sales exceed the price offered by a bidder for the entire company.

Clearlake Capital, the stalking horse bidder, has put forward a price of $60 million for the whole of the THQ business, but companies such as Electronic Arts and Warner Bros have shown interest in buying individual titles.

"Today's ruling provides a clear path. We will now know definitively by Jan. 23rd where we stand," said Brian Farrell, CEO of THQ. "We appreciate the support of our employees, partners, and suppliers now more than ever."

All bids must be received by January 22 at 9am Eastern Time. The auction will be held at 3pm and the hearing on the sale at 9:30am on January 23 with closing occurring a day later.

Original story:

THQ management's attempt to keep the company together may be in jeopardy. After US Bankruptcy Court Judge Mary Walrath sided with creditors upset over THQ's proposed process for auctioning off the company, stalking-horse bidder Clearlake Capital Group has agreed to changes that could see the publisher split between a number of buyers.

According to tweets from a Distressed Debt Investing writer present at court hearings, Clearlake has agreed to allow competing bids for individual titles in THQ's catalog. Additionally, the group offered to extend the deadline for competing bids to its own $60 million offer until January 15. (Originally, Clearlake wanted the sale process to be finalized by January 10.) However, Judge Walrath said that timeline was still too tight.

Distressed Debt Investing also reported that Electronic Arts was a potential bidder for a number of THQ titles, and "has completed site visits." Last week, THQ advisor Centerview Partners indicated that there were five potential buyers interested in picking up individual THQ games, including Warner Bros. Interactive Entertainment. Ubisoft could be another of the five, as the publisher's CEO told GamesIndustry International in November that THQ had some good brands it might be interested in acquiring.

An EA representative declined to comment on the report.

UPDATE: The Distressed Debt Investing feed has confirmed that an auction date of January 22 has been agreed upon. At the auction, THQ's games could be purchased individually by bidders.

12 Comments

Paul Jace
Merchandiser

921 1,374 1.5
The big question on everyone's mind is who will end up owning the Saints Row ip.

Posted:A year ago

#1

Peter Dwyer
Games Designer/Developer

481 290 0.6
Yep Saints and maybe Dark Siders but, THQ did have some good IP. I can't figure out how they failed so miserably as a business. Saint's alone should have been a company saver.

Posted:A year ago

#2

Morville O'Driscoll
Games Blogger & Journalist

1,530 1,330 0.9
@ Paul

Actually, I think the the big question is, who will end up with Relic/Relic's IP. Company of Heroes and a possible new Homeworld are more looked forward to than the next Saints Row, I think.

Posted:A year ago

#3

Bruce Everiss
Marketing Consultant

1,692 594 0.4
Sega failed with even more impressive IP.
You need good management as well as good IP.

Posted:A year ago

#4

Morville O'Driscoll
Games Blogger & Journalist

1,530 1,330 0.9
'Tis true. Poor Sega. :(

Posted:A year ago

#5

Morville O'Driscoll
Games Blogger & Journalist

1,530 1,330 0.9
Yeah, it would actually make a lot of sense to house Relic with Sega, considering the RTS talent there. Plus, Sega don't have a history (as far as I'm aware) of acquiring famous studios and closing them down/turning them into sequel factories.

Posted:A year ago

#6

Lewis Brown
Snr Sourcer/Recruiter

198 56 0.3
I would love to see Homeworld again was my favourite RTS!

Posted:A year ago

#7
homeworld petetion :)

Posted:A year ago

#8

Nick Parker
Consultant

282 149 0.5
The THQ situation reminds me a little of what happened to Infogrames. Infogrames was a Paris bourse CAC40 quoted publisher, number 2 behind EA in 2001 in terms of revenues. Unfortunately the management had aspirations to become number one and built up the costs (and acquisitions, Gremlin, Accolade, GT Interactive and Hasbro) to do so but did not have the games portfolio to support such growth. Sure, Infogrames had some great IP but not enough to pay for G&A all over the Western World. By 2007, it was owned by a hedge fund (BlueBay Asset Management) and, rebranded as Atari, is not even a shadow of its former self having had to sell off the IP family silver. I wish companies would switch off their emotional ambitions and size the business according to its primary assets. I'm not saying THQ management were this culpable but there are similarities.

Posted:A year ago

#9
SImilarly, Acquisitions can be a happy marriage, look at Eidos and Squeenix!

Posted:A year ago

#10

Rick Lopez
Illustrator, Graphic Designer

1,269 942 0.7
I do hope EA picks up darksiders and saints row. Slap the EA logo on it and its sure to help sales. But not only that, EA publishes a number of titles I like. I just hope they also take in vigil and volition and add them to there roster of studios. Id hate to see the original teams disbanded. Honestly I hope EA takes in all of THQ.

Posted:A year ago

#11

Charlie Andre-Barrett
European Digital Sales Manager

19 1 0.1
Relic would be great with Bethesda , Ubisoft and EA ! onwards and upwards for Relic ! i hope THQ Gets a good market value for this amazing studio !!

Posted:A year ago

#12

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