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[jackal27]

This is really sad... I haven't been too into THQ this generation (although they've made some great games), but I don't want it to end like this.

I'm really worried about something similar happening to a Capcom, Konami, Sqeenix, or other huge Japanese publishers in the next couple of years.

 

[DonMigs85]

Wasn't Capcom in a precarious financial state years and years ago?

 

[luffeN]

Can you buy Darksiders II Wii U directly from them? Or do I need to go through retailers? I guess the THQ Shop should work, right?

Edit: Oh, they don't have that game. They only have digital PC copies for Austria/Germany it seems

Another Edit: Microsoft should buy them already!

 

[Furoba]

Relic just got their Homeworld license from Sierra a few years ago, right?

 

[Barkley's Justice]

no, joke, for whatever reason, whenever i hear "thq" i think of this game:

 

[Data West]

http://www.youtube.com/watch?v=nSz16ngdsG0

 

[Nirolak]

loan covenants aren't about having money on hand. in fact given they are there for the lenders to protect their loans it is in some sense the opposite. the covenants are usually set around gearing. what this means is that THQ has probably breached the loan agreements over the level of shareholder funds. basically their equity has evaporated as i imagine in recent months they have written off assets and accumulated more liabilities.

A lot of control THQ is probably now about to be put in the hands of their banking syndicate, a standard term of banking covenants.

But it actually says in the OP that they have less than 12.5% availability on their revolving credit line causing a default, which makes sense since the maximum amount changes based on the time of year and being too high could cause them to be over when the timeframe shifts, unless I'm missing something.

 

[MrCunningham]

Even if THQ goes under, I'm sure someone will pick that one up.

I'm not sure if anything else is safe, though.

Aren't the developers of Metro independent from THQ as well? If things go bad here, surely they could find another publisher too.

 

[Father_Brain]

Morale must be incredibly low right now at THQ's remaining studios.

 

[fabricated backlash]

I want my Metro: Last Light very badly.

Same here, I'm not even pissed about the WiiU version being cancelled. At this rate the game might not even see the light of day at all.

Hopefully someone will pick up the few projects that are still unfinished once THQ has gone the way of the dodo.

 

[CecilRousso]

I would be suprised if even a cancellation of South Park would mean Obsidian closing. They should have been funded during the development of the title, and the Kickstarter has a relatively large team funded until 2014. If anything, it would probably mean a huge downsizing of the company with layoffs, but not them closing the door. If it did, then I would seriously question how companies like these are being run.

 

[Nirolak]

Kev just checked the loan documentation, and it is a secured loan, so Wells Fargo can seize basically all of THQ's assets if they want.

 

[_machine]

I really hope Vigil, Relic, Volition and 4A find a new, better home for themselves. Metro: LL needs to come out before THQ goes under.

 

[Nirolak]

I really hope Vigil, Relic, Volition and 4A find a new, better home for themselves. Metro: LL needs to come out before THQ goes under.

Why? At this point it would be better if a more competent publisher got control of the game and could choose to fund it longer.

An almost completed game certainly won't disappear if THQ dies.

 

[_machine]

An almost completed game certainly won't disappear if THQ dies.

Yeah, I just hope Wells Fargo will sell it to a competent publisher. I guess the odds of seeing it see daylight are pretty good though, but you never know.

 

[Clay Davis]

I feel sorry for thq. they have had some great games this generation. the reboot of red faction was incredible, the sequel less so and shouldn't exist but what can you do? at least we got the exceptional guerilla.

saints row has proven itself to be a great game in the same mould as grand theft auto. I didn't much like the first game, but the second was a revelation and I still play it every so often. the third was disappointing in the same way the first game was, I fully expected them to recapture the magic of 2 in the fourth title, but alas.

darksiders was a great game in the same mould as zelda, a genre that isn't catered to at all for non nintendo gamers. the sequel was decent, but I felt it lacked the same impact as the first, this was mainly due to it being a side story and not a continuation of the epic ending from the first game.

I didn't play warhammer, but I'm told it was passable.

overall, they had successes and went on to create three new game series that I dearly love. I hope another acquires those series and the teams and we still get more saints row, red faction and darksiders for years to come.

 

[Roo]

So... When are their IP's going for sale?

 

[BrokenEchelon]

If they're only worth like 5 mil now, why doesn't someone just buy them for the sheer sake of the IPs?

Activision could burn 5 mil and not miss it and EA or Ubisoft wouldn't have a hard time finding that cash.

 

[KojiKnight]

So... When are their IP's going for sale?

As mentioned above, Well Fargo has a secured loan on them and (presumably) all of their studios... so they probably have a couple months... I doubt Wells Fargo really wants to seize and sell as that's a lot of work... They may be hoping that with so many games close to release they can get more money out of THQ (paying off a couple more principle payments) before seizing them.

(edit) Broken: Even if you bought the entirety of THQ for 5 million you're also assuming ALL of their debt raising the cost significantly.

 

[Nirolak]

If they're only worth like 5 mil now, why doesn't someone just buy them for the sheer sake of the IPs?

Activision could burn 5 mil and not miss it and EA or Ubisoft wouldn't have a hard time finding that cash.

You have to absorb their outstanding debts, which moves to price up to like $100-$150 million

It's much cheaper to wait.

As mentioned above, Well Fargo has a secured loan on them and (presumably) all of their studios... so they probably have a couple months... I doubt Wells Fargo really wants to seize and sell as that's a lot of work... They may be hoping that with so many games close to release they can get more money out of THQ (paying off a couple more principle payments) before seizing them.

THQ does become notably less valuable if their games release though. Three near finished games is a lot more enticing.

 

[BrokenEchelon]

You have to absorb their outstanding debts, which moves to price up to like $100-$150 million

It's much cheaper to wait.

Yeah that just occurred to me now. Woops.

 

["God's Beard!"]

Kev just checked the loan documentation, and it is a secured loan, so Wells Fargo can seize basically all of THQ's assets if they want.

That'd be funny if Wells Fargo decided to just keep the assets and become a games publisher.

 

[Saty]

Common Tencent. THQ-Epic merger. EpicTHQ.

 

[RPGCrazied]

Wow. There is like a THQ thread like everyday. How are they staying afloat is beyond me. As I said many times, I hope the South Park game gets released. Quite sad the Darksiders IP is dead. Well, the creator left Vigil, so it might as well be.

 

[Shalashaska161]

At this rate I'm going to be surprised if THQ makes it to the end of the year. Too bad really, I kind of have a soft spot for them. Hopefully the good teams and ip's find good homes with new publishers.

 

[Delusibeta]

Matt & Trey probably wouldn't let the SP game be cancelled.

But will they be prepared to fund it themselves?

To be blunt: I expect Relic will either die or cut down massively and become an indie studio.

 

[metalslimer]

It was just a matter of time. Luckily Sega quickly refocused everything they were doing to avoid the same fate. People may not like the direction Sega is headed, but THQ continuing on with games like Metro was going to be a bad idea. And as soon as they said their expectation for Darksiders I knew it was a mistake.

 

[Baconsammy]

I could see Microsoft buying the South Park game. Not sure if any of the console holders would find Darksiders or Saints Row attractive enough to turn it into an exclusive, though. I hope for the best for all the employees.

 

[Nirolak]

But will they be prepared to fund it themselves?

To be blunt: I expect Relic will either die or cut down massively and become an indie studio.

Relic is fully owned by THQ, so whoever takes the "remaining assets" purchase will get control of them if no one buys them individually.

 

[Delusibeta]

Relic is fully owned by THQ, so whoever takes the "remaining assets" purchase will get control of them if no one buys them individually.

I guess that means Relic is dead, since I can't see anyone giving a PC RTS developer the time of day.

 

[metalslimer]

I guess that means Relic is dead, since I can't see anyone giving a PC RTS developer the time of day.

Valve

 

[McBradders]

I need the next great installments in the Saints Row franchise

And a new Dawn of War.

Don't die, THQ!

 

[JDSN]

I am really glad right now that Project Eternity was a success.

 

[entremet]

So what killed THQ? Weren't they doing better in the beginning of the generation?

 

[Opiate]

Interesting note in THQ's SEC filing on Friday regarding used games:

This reminds me of other companies blaming the economy or pirates: while I don't doubt those have an effect, they're only a few reasons out of many -- it's just easier for companies to focus on these three explanations because they aren't their fault.

Saying "We're going bankrupt because we greenlit a bunch of unsuccessful games and have bad management structure" sounds terrible. Saying "we're going bankrupt because of exogenous forces outside our control" sounds much better.

 

[Nirolak]

So what killed THQ? Weren't they doing better in the beginning of the generation?

Years of mismanagement best illuminated by:

1.) Sticking with a toxic licensed game business well beyond the point licensed games died.
2.) Trying to break into AAA core gaming in an increasingly polarized market without the money to actually do so.

Anyone who says "uDraw" is just looking at one of the last failures in over half a decade of problematic management.

 

[_machine]

4A own themselves, but the Metro IP and all their assets are owned by THQ, right?

 

[pa22word]

This reminds me of other companies blaming the economy or pirates: while I don't doubt those have an effect, they're only a few reasons out of many -- it's just easier for companies to focus on these three explanations because they aren't their fault.

Saying "We're going bankrupt because we greenlit a bunch of unsuccessful games and have bad management structure" sounds terrible. Saying "we're going bankrupt because of exogenous forces outside our control" sounds much better. It's not their fault, Gamestop is just a big meanie! Pirates are ruining everything! etc.

I mean no malice with this, but seriously what did you expect them to say >.>?

"We dug ourselves a hole so deep we can't get out"? I mean anyone who reads that can smell the PR speak from the thread list, but it's not like they can just come out and lay the truth down at the moment.

 

[Opiate]

I mean no malice with this, but seriously what did you expect them to say >.>?

"We dug ourselves a hole so deep we can't get out"? I mean anyone who reads that can smell the PR speak from the thread list, but it's not like they can just come out and lay the truth down at the moment.

That is precisely what I'm suggesting. They don't say those other things because, while they may be true, it looks terrible to admit gross personal negligence and feels much better (both for investors and for the self) to blame everything on forces outside your control.

 

[ClosingADoor]

So what killed THQ? Weren't they doing better in the beginning of the generation?

uDraw HD... and Homefront. And the move of casuals to other platforms, so they couldn't keep making cheap license games.

 

[metalslimer]

Either way used games or complete mismanagement I would have no confidence in THQ because used games aren't going away anytime soon.

 

[Sentenza]

Valve

Relic+Valve would (probably) be a great match.
That said, it's also very unlikely, at least looking at Valve's track record.

They don't seem too fond of big purchases or publishing big budget third party products.
They usually like to hire talented small teams or modders, involving very low upfront investments with large chances of being profitable.

 

[SpeedySwaf]

I really hate it when companies with legitimately good titles go under.

What happened to cause this? I know Homefront bombed pretty hard, but did everything else they have sell that badly, or was it mostly due to mismanagement of funding?

 

[sflufan]

The default conditions may be related to the price of the stock rather than an inability to fund the line of credit.

The line of credit may have provisions that the THQ stock price cannot fall below a certain level.

 

[Paladin CL]

I hope they dont die!! Saints Row, Company of Heroes and Warhammer (and South Park) dont deserve that

 

[metalslimer]

I hope they dont die!! Saints Row, Company of Heroes and Warhammer (and South Park) dont deserve that

South Park will come out from someone, and someone will buy the SR IP

 

[Technosteve]

I Hope square enix buys relic for their european market.

 

[Waaghals]

So, what is the likelihood of Games Workshop buying Relic?
They are the only one to truly nail the warhammer look and feel in games.

 

[SniperHunter]

i hope someone saves volition! Red Faction Guerrilla is the best game of this generation.

 

[KojiKnight]

I hope they dont die!! Saints Row, Company of Heroes and Warhammer (and South Park) dont deserve that

THQ doesn't own warhammer so there is no worries there... it'll just get tossed over to another dev/publisher. All of those other titles too are money makers, they'll eventually just be bought up by a studio that can actually do something with it (and likely a lot of their developers will go with it, either through direct aquisition or from picking up employees after the fact)