THQ THQI, a leading worldwide developer and publisher of
interactive entertainment software, today announced that it entered into an
Asset Purchase Agreement with a “stalking horse bidder,” affiliates of
Clearlake Capital Group, L.P., to acquire substantially all of the assets of
THQ's operating business, including THQ's four owned studios and games in
development. The sale will allow THQ to shed certain legacy obligations and
emerge with the strong financial backing of a new owner with substantial
experience in software and technology.
To facilitate the sale, THQ and its domestic business units have filed
voluntary petitions under Chapter 11 of the U.S. Bankruptcy Court for the
District of Delaware. The company's foreign operations, including Canada, are
not included in the filings. The company has obtained commitments from Wells
Fargo and Clearlake for debtor-in possession (DIP) financing of approximately
$37.5 million, subject to Court approval.
THQ will continue operating its business without interruption during the sale
period, subject to Court approval of THQ's first-day motions. All of the
company's studios remain open, and all development teams continue. The company
remains confident in its existing pipeline of games. THQ maintains
relationships with some of the top independent development studios around the
globe. As part of the sale, the company is seeking approval to assume the
contracts of these studios, and Clearlake will assume these contracts.
“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.”
According to Jason Rubin, who joined THQ as President last May, “We have
incredible, creative talent here at THQ. We look forward to partnering with
experienced investors for a new start as we will continue to use our
intellectual property assets to develop high-quality core games, create new
franchise titles, and drive demand through both traditional and digital
channels.”
Clearlake has agreed to serve as the “stalking horse bidder” for a Section 363
sale process, which allows other interested parties to come forward with
competing bids. Aggregate consideration offered by Clearlake for the purchase
totals approximately $60 million, including a new $10 million note for the
benefit of the company's creditors. The company is asking the Court for a
schedule to complete the sale process in about 30 days.
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