THQ has entered into talks with a couple of potential investors, in the hope that it will secure funding to see it through the current tough times with stock pricing and game delays that sees it threatened with liquidation.
However while those discussions are ongoing, it has managed to secure additional temporary funding and a halt on loan repayments from Wells Fargo Capital Finance. This deal will last until 15th January 2013 and will mean that the finance firm will not exercise its rights with regards to the $50 million already loaned to THQ.
“We are pleased to have reached an agreement with Wells Fargo,” THQ boss Brian Farrell said (via Eurogamer). “This agreement enables us to continue focusing on bringing our games in development to market.
“Meanwhile, we are evaluating financial alternatives that will transition the company into its next phase.”
THQ has been in troubled waters for almost a year at this point. The first signs of a problem were with staff layoffs and a gradually dipping stock price. However things turned from bad to worse when it was announced that due to funding complications, the Warhammer 40,000 MMO Dark Millenium, had to be converted to a standard RPG because the money simply wasn’t there for a massive online game. There were further issues with THQ failing to put together a game based on an Adidas application and staff firings at many of the publisher’s studios followed.
The recent downturn in stock and outlook for the company came from insufficient sales of Darksiders 2 – it required at least 2 million to break even and sold less than 1.5 million – and the announcement that the next Company of Heroes, as well as the upcoming South Park game would be delayed.
KitGuru Says: THQ is circling the drain guys. If you’re a fan of the publisher, keep your fingers crossed.