New Deal In The Works, CFO Resigns
Financially struggling publisher THQ have managed to negociate some breathing room with their creditor, Wells Fargo, despite defaulting on repayment of a $50 million loan. Apparently this time will be used to secure a new line of sponsorship or proceed with a buyout.
Wells Fargo, who are currently owed $50 million in unpaid loans, have decided to give THQ eight weeks to get their affairs in order before seeking to recover the funds. "We are pleased to have reached an agreement with Wells Fargo," reported chief exec Brian Fargo. "This agreement enables us to continue focusing on bringing our games in development to market."
THQ claims that they have “entered into exclusive negotiations with a financial sponsor regarding financing alternatives," but the deal "may result in, among other things, significant and material dilution to shareholders." To translate from business jargon into plain English: a buyout could well be on the cards.
Chief Financial Officer and Executive Vice President Paul Pucino has now resigned in light of THQ's increasingly fraught financial position, which has lead them to delay three games - Metro: Last Light, South Park and Company Of Heroes - cancel Guillermo Del Toro's InSane trilogy and massively decrease the scope and ambitious of WH40K: Dark Millenium. The next eight weeks will be absolutely critical for the embattled publisher, and we'll keep you up to date with the latest.