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THQ enters forbearance with Wells Fargo, chief financial officer resigns

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Troubled publisher THQ has announced a forbearance agreement with Wells Fargo Capital Finance. It also announced the resignation of Chief Financial Officer Paul Pucino. That will allow THQ more time to pay its debts and to receive additional loans from the bank. Wells Fargo agreed to this because of “exclusive negotiations with a financial sponsor.” There is no guarantee these negotiations will save the company, or lead to anything at all. But Wells Fargo is convinced enough to agree to forbearance. Pucino has been the CFO since 2009, and its Chief Accounting Officer since June 2012.

THQ’s financial issues are well known. A recent investors call lasted only 13 minutes. During that call executives announced that three of the publisher’s most anticipated games: Metro: Last Light, South Park: The Stick of Truth and Company of Heroes 2 were delayed. Several projects including Guillermo Del Toro’s inSANE and Devil’s Third, which would have been the first release from Tomonobu Itagaki’s Valhalla Game Studios, got the heave-ho. THQ also sold the Ultimate Fighting Championship license to EA. The uDraw GameTablet gets some of the blame for the publisher’s troubles, as it has more than 1 million unsold tablets in its inventory.

Darksiders 2, one of the IPs that survived a mass culling of projects at THQ, is officially a disappointment. It moved only 1.4 million units despite strong critical reception. The first Darksiders was a pleasant surprise, convincing new CEO Jason Rubin that it was a franchise to build around. THQ has only $15 million on hand, not enough to finish the games it needs to try and salvage things. Financial consulting firm Centerview Partners will advise THQ on how to hopefully get out of this mess.

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