Game Developer THQ Files For Bankruptcy

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News Posted: Thu, Dec 20 2012 9:35 AM
Hard times have fallen on video game maker THQ, which reportedly filed for Chapter 1 bankruptcy this week. Affiliates of private equity firm Clearlake Capital Group L.P. will acquire THQ's assets for around $60 million, taking control of the company's four studios and any games currently in development. The sale will allow THQ to shed certain legacy obligations and emerge with a strong financial backing of a new owner, the games developer said.

"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."

Saints Row

THQ is trying to shine a positive light on the situation, calling it a "new start" for the company. All of THQ's studios will remain open and all development teams will continue working on their current projects. According to THQ, consumers and retailers should see no changes while the company completes its sale.

"Rest assured that the goal throughout the sale process has been to preserve our teams and our products. So no matter what the outcome in 30 days, as long as we have accomplished this goal, I will be satisfied," Jason Rubin, President of THQ, said in a statement. "Whatever happens, the teams and products look likely to end up together and in good hands. That means you can still pre-order Metro: Last Light, Company of Heroes 2, and South Park: The Stick of Truth. Our teams are still working on those titles as you read this, and all other rumored titles, like the fourth Saints Row, the Homefront sequel, and a lot more are also still in the works."

Shares of THQ plummeted more than 73 percent following news of the bankruptcy. The company's stock in pre-market trading is valued at just $0.36 per share, far below the 52-week high of $9 per share.
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sackyhack replied on Thu, Dec 20 2012 10:10 AM

Saw this earlier. It's really heartbreaking. I hope they survive this as they've published some of my favorite games. I'm really curious about whatever's going on financially in the background. They've released so many games that I thought were relatively successful, like the Saints Row series, Metro 2033, etc. Why are they doing so bad as a company?

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Dorkstar replied on Thu, Dec 20 2012 10:35 AM

@Sackyhack : I just don't think THQ is unique enough. Saints Row, Metro, and Company of Heroes has kind of all already been done before. Sure they added their own unique spin to most of them, and while they were quality games, they just didn't catch on as much as some of the others.

Homefront on the other hand was...okay. The graphics were gritty, and the mechanics were a little awkward. It just didn't feel smooth.

Although I do find it off that a company that released some solid titles, though not the most popular, is facing financial issues. Sounds to me like someone was throwing too much money away.

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3vi1 replied on Thu, Dec 20 2012 12:36 PM

Seriously... how bad were their finances?!?! They raised $5M just A WEEK OR SO BACK, from the Humble THQ Bundle.

What part of "Ph'nglui mglw'nafh Cthulhu R'lyeh wgah'nagl fhtagn" don't you understand?

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OSunday replied on Thu, Dec 20 2012 4:21 PM

I think that this isn't just something that can be looked at from a "positive spin" but it is a positive thing its self.

The fact that they filed bankruptcy isn't good but since they'll be transitioning between the way their finances are managed and it won't impact consumers or their current releases and things will continue to go as planned it really just sounds like a way for them to keep doing what their doing but tweak it to be more financially succesful.

Metro: Last Light and South Park: Stick of Truth both look like they have the potential to be blockbuster titles when they come out

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CDeeter replied on Thu, Dec 20 2012 6:03 PM

I know, right. I got the bundle myself.

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imAcpufan replied on Fri, Dec 21 2012 2:21 AM

I really enjoy playing Company of Heroes...I sure hope COH 2 stays through development.

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