Publisher THQ announced today that it has filed for Chapter 11 bankruptcy with the U.S. Bankruptcy Court for the District of Delaware and has entered into an Asset Purchase Agreement with affiliates of Clearlake Capital Group, L.P., who will serve as a "stalking horse bidder," the agreement allows Clearlake Capital Group to acquire THQ’s assets including THQ’s four wholly-owned studios, any licenses it currently holds, and all games in development.
THQ said in its announcement that this sale will allow the company to shed "certain legacy obligations and emerge with the strong financial backing of a new owner with substantial experience in software and technology." The company said that its foreign operations, including Canada, are not included in the filings. The company has also obtained commitments from Wells Fargo and Clearlake for debtor-in possession (DIP) financing of approximately $37.5 million, subject to the court's approval.
THQ also said that these actions will not cause an interruption in its business during the sale period: "All of the company’s studios remain open, and all development teams continue," the company said. "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 agreement with Clearlake will allow THQ to go through a Section 363 sale process, which allows other interested parties to come forward with competing bids. Clearlake has offered approximately $60 million to buy the company, including a new $10 million note for the "benefit of the company's creditors."
THQ is asking the Court to approve the sale process in about 30 days.
THQ is being advised by Centerview Partners LLC and FTI Consulting as its financial advisors and Gibson, Dunn & Crutcher as legal counsel. Clearlake is being advised by DLA Piper as legal counsel. THQ also noted in its announcement that it expects to receive a notice from NASDAQ that its stock has been delisted from the exchange…
THQ is best known for such popular series as the WWE brand of wrestling games, the Darksiders series, the Saints Row series, Company of Heroes, Red Faction and many other games.
Source: THQ Investor Center