Streaming games service OnLive was acquired for less than $5 million, a new report has claimed.
Mercury News cites a letter from Insolvency Services Group CEO Joel Weinberg for word that OnLive’s assets were purchased for just $4.8 million.
The letter apparently went on to say that OnLive had been seeking a buyout or major investment for a “substantial period of time”. When time ran short, and debts mounted, the company chose to liquidate its assets in such a way that allowed venture capitalist Gary lauder to scoop them all up, keeping the company operational.
Weinberg, whose company oversaw OnLive’s bankruptcy, reportedly described the deal as the best possible outcome.
“Had the sale to the buyer not taken place, the assignee would have been left with inadequate capital to fund the significant costs to preserve and market OnLive’s patents and other intellectual property, thus greatly reducing expected recoveries essentially to those of a forced piecemeal auction,” he wrote.
OnLive announced its bankruptcy and reformation in August. Although it allowed the company to continue operating, the move left former employees without equity. Founder and CEO Steve Perlman left the company, accompanied by rumours of his unpopularity among staff.