Midway initiates Section 363 process, Warner Bros. expected to bid

As we know, Midway is bankrupt and selling it’s assets to the highest bidder. Midway announced on May 21, 2009, that it entered into a “stalking horse” asset purchase agreement with Warner Bros. Entertainment Inc. and filed a sale and bid procedures motion with the Bankruptcy Court to conduct the sale of the Company’s assets pursuant to Section 363 of the United States Bankruptcy Code. In other words, Warner Bros. is looking to bid on the company.

A “stalking horse” is a person who tests a concept with someone on behalf of an anonymous third party. If the idea proves viable and/or popular, the anonymous figure can then declare their interest and advance the concept with little risk of failure. If the concept turns out to be terrible, the anonymous party can either drop the idea completely or wait until a better moment for launching an attack.