Author Topic: Another one bites the dust: Midway files for bankruptcy protection  (Read 5578 times)

Offline MysterD

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Another one bites the dust: Midway files for bankruptcy protection
« on: Monday, December 01, 2008, 03:19:58 PM »
Midway has been sold off for $100,000, due to an outstanding debt they had.

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Midway Sold
[December 01, 2008, 09:48 am ET] - Share - Viewing Comments
Reuters reports Sumner Redstone has sold his controlling interest in Midway Games after years of poor performance. The report says Redstone's National Amusements will announce today the sale of its 87% stake in Midway for approximately $100,000.

No, there are no zeros missing from that sentence, as the price is about $0.0012 per share, which may literally satisfy that old saying about a stock not being worth the paper it's printed on. In that way rich people have of making chicken salad out of the less edible portions of the chicken, the $100,000 sale will net national amusements a 2008 tax loss of approximately $800 million, which represents about half of the company's outstanding debt. Thanks GamePolitics. If disclosure is appropriate here, at one time I indirectly worked for Sumner Redstone, as Viacom assumed control of MTV Networks during my tenure there.

Offline Xessive

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #1 on: Monday, December 01, 2008, 04:05:28 PM »
Wow.

Offline MysterD

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #2 on: Monday, December 01, 2008, 04:25:17 PM »
Wow.

That was my reaction -- b/c the value was only 6 figures.
I'd figure it would've been more, but they owe like $70 million...

Offline Pugnate

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #3 on: Monday, December 01, 2008, 04:48:55 PM »
So someone paid 70 mill for them? What do they own?

Offline MysterD

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Offline Quemaqua

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #5 on: Monday, December 01, 2008, 06:36:40 PM »
No, Redstone's National Amusements sold them.  Someone by the name of Mark Thomas bought them, paying $100,000 and assuming the full 70m debt.

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National Amusements has about $1.6 billion in debt outstanding. Half of that will need to be repaid by year-end.

The company also holds controlling voting stakes in CBS Corp (CBS.N: Quote, Profile, Research, Stock Buzz) and Viacom Inc (VIAb.N: Quote, Profile, Research, Stock Buzz). It had already sold about $230 million in shares of both companies to help meet debt payments.

National Amusements is expected to realize a 2008 tax loss of more than $800 million from the sale, the paper said citing a person familiar with the situation.

The company could use a portion of the loss against income earned this year, as well as a tax refund of amounts paid in prior years, the source added.

天才的な閃きと平均以下のテクニックやな。 課長有野

Offline scottws

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #6 on: Monday, December 01, 2008, 06:42:13 PM »
What does Midway even do these days?  The last game I remember playing that had the Midway logo was Gauntlet: Dark Legacy and that was a long, long time ago.  And it wasn't very good.

Offline Quemaqua

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #7 on: Monday, December 01, 2008, 06:46:20 PM »
They owned some fairly decent names, but like the one you mentioned, most haven't done anything much in a long while, nor has a lot of their recent material been all that great.  I think there were a few solid titles in there, but most of them went under everyone's radars.

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Offline MysterD

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #8 on: Monday, December 01, 2008, 07:54:32 PM »
No, Redstone's National Amusements sold them.  Someone by the name of Mark Thomas bought them, paying $100,000 and assuming the full 70m debt.


Thanks for clarifying, Que.

Offline Ghandi

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #9 on: Monday, December 01, 2008, 07:57:38 PM »
What a terrible investment.

Offline K-man

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #10 on: Monday, December 01, 2008, 09:54:58 PM »
MK vs DC is garnering decent reviews.

Offline gpw11

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #11 on: Monday, December 01, 2008, 10:40:18 PM »
What a terrible investment.

I was thinking the opposite.  That's a pretty good deal for some of the properties associated with Midway.  Well, actually, I can only think of like two.

Offline Ghandi

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #12 on: Monday, December 01, 2008, 11:03:16 PM »
Well I hope he has some deep pockets. It's a costly venture to turn a company around with that much debt, and good luck getting a loan at the moment.

Although I should add that I know next to nothing about Midway.

Offline gpw11

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #13 on: Monday, December 01, 2008, 11:29:03 PM »
I think the main thing is that we don't know anything about Mark Thomas.  Midway's debt is important, but the most important thing to look at in transactions like this is the debt of the parent company. Midways $70 million debt means little when we don't know the terms and/or conditions of the sale or the loans or even to whom the debt is owed.  Midway has the potential to be profitable in one way or another, and people have bet on bigger long shots with far more outstanding debt in worse times and had it pay off.   Note that he didn't take on any of Midway's debt as personal debt.

Offline Ghandi

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #14 on: Monday, December 01, 2008, 11:34:11 PM »
Indeed. I know virtually nothing about any of this, so I'm going to quietly exit the conversation now and let people who know what they are talking about take over.

Offline gpw11

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #15 on: Tuesday, December 02, 2008, 12:01:10 AM »
Actually, I just looked at it more and I was totally wrong.  Don't trust video game 'journalists' to use 'buying debt' and 'taking on debt' in the right context or even correct place.  Apparently  as part of the agreement he 'personally' took on the $70 million debt, although from what I gather the debt is actually owed TO the parent company rather than a third party...which is far less risky for himself as the terms are probably in his favor. Considering the nature of entertainment businesses, I'd say it's still a bargain considering Midway shares have been around $5 in the last year (but sure as hell not right now), but no where near as safe or ludicrous of a deal as I thought it was a few min ago.  He also is saying he's not sitting on the board.  I wonder what he's up to.

Offline Xessive

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #16 on: Tuesday, December 02, 2008, 05:01:32 AM »
I kept seeing Midway get involved in other peoples' projects like Epic! It was so frustrating to see a Midway effect on the Unreal games.

Offline gpw11

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #17 on: Tuesday, December 02, 2008, 06:13:03 PM »
To be fair, it was equally frustrating to see an Epic effect upon Unreal games.

Offline Quemaqua

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #18 on: Tuesday, December 02, 2008, 07:46:24 PM »
To be fair, it was equally frustrating to see an Epic effect upon Unreal games.

QFT

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Offline Xessive

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #19 on: Wednesday, December 03, 2008, 05:07:44 AM »
To be fair, it was equally frustrating to see an Epic effect upon Unreal games.
True.. It was deviating too much from classic Unreal.

Offline Pugnate

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #20 on: Wednesday, December 03, 2008, 10:59:03 AM »
Despite the issues that annoyed the hardcore, the new UT game was quite quite good.

Come on guys.

Offline Xessive

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #21 on: Wednesday, December 03, 2008, 11:20:02 AM »
I like UT3. I hated UT2003.. Which I think we can all omit from existence from now on. UT2004 was ok.

UT3 is good but it feels lacking. Like they didn't really push the envelope with it.

Offline MysterD

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Re: Midway sold for $100,000 (yes, that number is correct - since they owe money)
« Reply #22 on: Wednesday, December 03, 2008, 04:58:32 PM »
I like UT3. I hated UT2003.. Which I think we can all omit from existence from now on. UT2004 was ok.
I also like UT3.

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UT3 is good but it feels lacking. Like they didn't really push the envelope with it.
I think that might be why UT3 will have an expansion pack.
Which I have no problem with -- I mean, by now, for $20 or less, you can pick up UT3: Reg or Collector's Ed
For that price, it's so totally worth it.

Offline K-man

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Another one bites the dust: Midway files for bankruptcy protection
« Reply #23 on: Thursday, February 12, 2009, 11:09:35 AM »
Writing has been on the wall for some time, but it still sucks.  Hopefully a decent restructuring will follow

http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2009/02/12/financial/f084322S85.DTL&tsp=1

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Midway Games Inc., best known for its "Mortal Kombat" video games, said Thursday that it filed for Chapter 11 bankruptcy protection.

Midway said the filing stemmed from a change in ownership in late 2008 that led to accelerated buyback requirements related to two classes of debt that the company did not think it could fulfill.

In December, media mogul Sumner Redstone sold his majority stake in Midway — an interest of about 87.2 percent — to a company led by private investor Mark Thomas.

In a statement, Midway Chief Executive and President Matt Booty called the bankruptcy filing a "difficult but necessary decision."

"We have been focused on realigning our operations and improving our execution, and this filing will relieve the immediate pressure from our creditors and provide us time for an orderly exploration of our strategic alternatives," he said.

Midway said that it and its U.S. subsidiaries filed voluntary petitions in U.S. Bankruptcy Court for the District of Delaware.

Midway said the filing does not include its operations outside the U.S., and that they will continue to operate as normal.

The company is seeking several first-day motions so it can continue to operate normally.

Midway shares fell 10 cents, or 40 percent, to 15 cents in morning trading.


Man I'd hate to be a recent graduate of a place like Guild Hall right now.

Offline Quemaqua

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #24 on: Thursday, February 12, 2009, 11:31:55 AM »
K-Man's topic merged with MyD's previous news thread.

天才的な閃きと平均以下のテクニックやな。 課長有野

Offline K-man

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #25 on: Thursday, February 12, 2009, 12:29:32 PM »
Ah shit, didn't even think to look for a similar thread.  Sorry Que

Offline Cobra951

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #26 on: Thursday, February 12, 2009, 12:41:16 PM »
I wouldn't have thought to tack a post about bankruptcy to this thread, although it probably does belong here (as the inevitable consequence).

Chapter 11 is not the end.  Chapter 7 is.  Hopefully, they'll be able to get beyond this reorganization without having to go there.

Offline Quemaqua

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #27 on: Thursday, February 12, 2009, 01:02:31 PM »
Yeah, we can only hope.  It's a shame.

And don't sweat it, K.  I don't expect everyone to search for everything.  I just happened to remember we had a similar thread so thought I may as well combine, as much for giving people who missed them a chance to read the old posts as it was for housekeeping.

天才的な閃きと平均以下のテクニックやな。 課長有野

Offline scottws

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #28 on: Thursday, February 12, 2009, 06:35:27 PM »
I wouldn't have thought to tack a post about bankruptcy to this thread, although it probably does belong here (as the inevitable consequence).

Chapter 11 is not the end.  Chapter 7 is.  Hopefully, they'll be able to get beyond this reorganization without having to go there.
This is probably a dumb question, but are there other bankruptcy chapters?  All you ever hear about are 7 and 11.

Offline idolminds

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #29 on: Thursday, February 12, 2009, 07:11:44 PM »
I would venture a guess that there are at least 9 others.

EDIT

Wikipedia says six.

    * Chapter 7: basic liquidation for individuals and businesses;
    * Chapter 9: municipal bankruptcy;
    * Chapter 11: rehabilitation or reorganization, used primarily by business debtors, but sometimes by individuals with substantial debts and assets;
    * Chapter 12: rehabilitation for family farmers and fishermen;
    * Chapter 13: rehabilitation with a payment plan for individuals with a regular source of income;
    * Chapter 15: ancillary and other international cases.

Offline Cobra951

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #30 on: Thursday, February 12, 2009, 10:04:13 PM »
I knew about 13 too, but not the others.

Offline nickclone

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #31 on: Saturday, February 14, 2009, 02:22:07 AM »
This is whom they owe and how much:

* Wells Fargo Bank - $150,000,000
* Acquisition Holdings Subsidiary - $40,000,000 unsecured loan (Thomas is the mystery man who purchased Midway late in 2008)
* National Amusements, Inc. - $20,147,864
* NBA Properties, Inc. - $17,294,849 (License/royalty settlement)
* Tangible Media, Inc. - $8,675,954
* Warner Bros. Interactive - $6,654,203
* Artificial Mind & Movement - $2,000,000
* Epic Games - $1,975,000 (License/Royalties)
* Walmart - $1,576,035
* Far Sight Technologies - $1,279,151
* Best Buy - $1,114,036
* Target - $934,156
* Technicolor Video Services - $637,769
* Toys R Us - $615,276
* Ditan/Synergex Canada - $578,316
* CBS Outernet - $314,600
* David Zucker - $300,000 (severance pay)
* Multi Packaging Solutions - $287,036
* A.A.F.E.S Headquarters - $276,314
* Kmart - $218,497
* Tigon Studios - $200,000(license/royalties)
* Hollywood Entertainment - $190,982
* TNA Entertainment - $160,000 (license/royalties)
* Professional Films, Inc. - $150,000
* Synergex - Latin America - $149,027
* Pioneer.JB Marketing - $133,353
* Eclipse Advertising - $132,687
* GameStop - $127,250
* Sear, Roebuck - $125,495

http://kotaku.com/5153517/this-is-why-midway-is-totally-screwed

Offline Quemaqua

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #32 on: Saturday, February 14, 2009, 11:00:28 AM »
It's like a mini-California, or extra-mini-USA.

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Offline Cobra951

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #33 on: Saturday, February 14, 2009, 12:42:29 PM »
Or a maxi any one of most Americans.

That list, along with the mini and maxi implications, also shows why the economy is screwed.  What are the odds Wells Fargo is ever seeing that money now?

Offline MysterD

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Offline MysterD

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #35 on: Thursday, May 21, 2009, 02:36:46 PM »
Warner Bros. is trying to buy Midway for $33 million.

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Warner could acquire the Mortal Kombat series and Midway’s Chicago and Seattle studios.
Midway’s Newcastle and San Diego studios are not included in the deal, nor is the firm’s TNA series.

Offline scottws

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #36 on: Thursday, May 21, 2009, 07:24:52 PM »
In other news, the Gauntlet series will never die.

Offline MysterD

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Re: Another one bites the dust: Midway files for bankruptcy protection
« Reply #37 on: Friday, May 22, 2009, 02:55:29 PM »
IP's don't die.
Other companies -- especially big companies -- just buy 'em right the hell out.