THQ files Chapter 11 bankruptcy, assets to be purchased by Clearlake Capital
There’s a sad inevitability to this news, as there have been financial problems at THQ for a number of months now. Today, the company filed for Chapter 11 bankruptcy and entered into an ‘Asset Purchase Agreement’ with Clearlake Capital. That means the four studios owned by THQ (including Volition and Vigil) and all games in development by the company will be acquired by Clearlake.
According to a THQ press release, “The company’s foreign operations, including Canada, are not included in the filings”. Where this leaves Canadian-based developers Relic (currently working on Company of Heroes 2) is unclear.
Clearlake’s likely intent is to keep THQ running long enough to steer it through the bankruptcy courts (thereby removing much of its debt), then sell off the intellectual properties one by one in an attempt to recoup more than they paid for THQ’s assets.
This looks like very bad news for two sets of people: (1) anybody currently working at THQ in a role that Clearlake will deem to be ‘non-essential’ to its above intentions, (2) anybody who THQ currently owes money to (as the bankruptcy proceedings will wipe out most of the company’s debt).
However, this course of action should mean that forthcoming THQ games like Metro: Last Light, South Park: The Stick of Truth and a potential fourth entry in the Saints Row series see the light of day in some form. The business filings have also revealed the working titles of some as-yet-unannounced titles. These include ‘1666’ from Assassin’s Creed creator Patrice Desilets, ‘Atlas’ from Relic, Turtle Rock’s ‘Evolve’ and Vigil’s ‘Crawler’. Intriguing.
Clearlake will purchase THQ’s assets under a “Section 363 sale process,” which gives other companies a 30 day window to approach with rival bids. As things stand, the assets will be sold to Clearlake for $60 million USD ($10 million of which will be set aside for creditors).