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THQ: Rubin’s open letter outlining a “new start”

Thursday, 20th December 2012 11:57 GMT By Dave Cook

THQ filed for bankruptcy protection last night, sparking fears over the status of its outstanding products – such as Metro: Last Light and South Park: The Stick of Truth. Company president Jason Rubin has now issued an open letter that plays down the “click-grabbing headlines” that he believes will follow the issue, and assures investors, the press, and gamers alike that the move is natural whenever a company looks to adjust its financial position.

In an open letter published on the THQ site, Rubin confirmed that the group has secured investment from a private equity firm named Clearlake Capital Group, which Rubin says will not block the completion of the company’s outstanding titles.

Said Rubin, “Clearlake is even providing the company the money it needs to keep working on the products as the process plays itself out. And importantly, when the purchase is complete, Clearlake has committed to invest additional ample capital to let us finish the games we are making and continue making games going forward.

“In short, they are investing in a new start for our company.”

Rubin goes on to explain that the sale had to be carried out through a “Chapter 11 proceeding of the Bankruptcy code”, and added, “The most important thing to understand is that Chapter 11 does not mean the end of the THQ story or the end of the titles you love. Quite the opposite is true, actually.”

He explained that the filing is common among companies that are undergoing restructuring, and that other major firms – such as American Airlines – have also filed for a Chapter 11 proceeding, and then name-dropped other firms that have gone down the same route, such as Marvel, MGM, and car manufacturer Chrysler.

The filing, Rubin said, is a technicality that allows other bidders to make a sale attempt, and added that, “Whatever happens, the teams and products look likely to end up together and in good hands.” He also made clear that THQ has a January 15th bank funding deadline, which is why the bankruptcy protection filing has been made now.

Rubin closed in saying, “So THQ made headlines today – and I am sure there will be tons of click-grabbing headlines over the next month or so. But what matters to us is not what is happening to THQ right now, but what the company and its teams will make of ourselves after we complete the sale.

“In short, the teams will be unburdened by the past and able to focus on what they should be focusing on — Making great games.

“I’m excited about the future and hope to have more to report soon.”

What’s your take on the issue. Let us know below.

Thanks MCV.

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18 Comments

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  1. Dragon246

    At least they aren’t going out of business.

    #1 2 years ago
  2. blackdreamhunk

    Remember me my words always come to pass I wish it was not THQ they are great publisher that is what you get when you support console bankuprt publishers and game devs out of a job. Thank Microsoft and Sony!

    #2 2 years ago
  3. xXNapsterManXx

    Lol are you trying to blame m$, Sony and consoles blackdreamhunk? Is you want to blame anyone blame PC pirates they do more damage then the others.

    #3 2 years ago
  4. OnionPowder

    Or you can blame poor management and stupid decisions like uDraw.

    #4 2 years ago
  5. blackdreamhunk

    it’s called high productions costs on consoles!do you remember my words

    #5 2 years ago
  6. tezzer1985

    @5 I’m sorry but I disagree with you, strongly, if that was the case every other publisher would be bankrupt

    Sony and Microsoft make a lot of publishers money. It’s down to the publisher to market and make GOOD games. If a publisher decides to make sub par games, then they have themselves to blame, for poor sales.

    #6 2 years ago
  7. blackdreamhunk

    @7 remember my words I point out a number of publishers going bankrupt and game devs out of jobs! My words always come to pas always! exmple Midway, serba,Interplay for exmple I even gave a list of bankuprt game devs! You don’t remeber do you. I do.

    Remember I say I would grab some popcorn wait for the next publisher to bankuprt

    #7 2 years ago
  8. OnionPowder

    @7 Interplay is still around. Not only that but when interplay went to shit they were still making mostly PC games.

    #8 2 years ago
  9. Ireland Michael

    @7 His words is solid!

    #9 2 years ago
  10. Da Man

    Well, at least Mr Blackdreamhunk actually contributes something more than a few drunken generic paraphrases..

    #10 2 years ago
  11. DSB

    Rubin is writing the book on games industry PR right there.

    I’m borderline excited about this. Hopefully he’ll get some elbow room with Clearlake calling the shots.

    #11 2 years ago
  12. Christopher Jack

    Would be interesting if any of the 3 console manufacturers bought THQ, though it’d unfortunately mean a lot of people being fired unless the publisher’s willing to allow them to release games for other platforms- though Microsoft & Sony already have studios for PC at least there’d be a better chance for them continuing support for PC. Although I could see Ninty having the most to gain outta the big 3- they could finally start a core games division & recapture many of those who left for that reason.

    I highly doubt any of them would purchase THQ but it’s interesting to think about & what would happen if so. Frankly I doubt that any game publisher will pick them up but if it were to happen, EA & Activison- maybe Squenix & Ubisoft seem like the only ones likely to pick them up.

    #12 2 years ago
  13. Phoenixblight

    @11

    Until Clearlake sells THQ. They don’t plan on keeping them. They bought it for a low price and plan on upping the value to then sell. I wouldn’t hold my breath I suspect all the studios that in their pre-development phase will be getting massive layoffs and THQ focusing on getting their releases out as fast as possible.

    Clearlake secured THQ assets for 60 million when THQ actually owes 100 million. 10 million is to be given to the creditors and 50 million is to finish the development of COH,Metro and Southpark.

    #13 2 years ago
  14. DSB

    @13 That’s a big if. Whether they sell them depends fully on whether they can turn them into a viable business again. The best way to do that might not be to undermine the studios with even more layoffs. THQ have already been busy on that front.

    Either way, if they can’t, they’ll strip it and divide the profits. SOP.

    #14 2 years ago
  15. Phoenixblight

    THats their plan is to make a profit. THeir goal is to make THQ a viable product to then sell whether its as a bundle or in pieces. But they will be laying off people. That 50 million was just for the studios involved with titles that are releasing in the next few months to year so Turtle,Relic,Vigil will be getting layoffs.

    Clearlake is not looking to do this long term partnership they are for a quick buck.

    #15 2 years ago
  16. DSB

    @15 They’re going to do what they have to do, but nothing is going to happen overnight. First they need a plan for Chapter 11 (which will probably include layoffs) and then they need to turn the company around, which doesn’t consist of simply razing studios and lowering costs.

    They’ll have to actually perform, which means real investment, and my guess is that it wouldn’t take less than 2 years to complete something like that. Some private equities hold onto companies for more than a decade.

    #16 2 years ago
  17. Phoenixblight

    @16

    I have seen it many times and from my experience they usually fire 50% of their employees starting with management and move down so they can build it right back up in a more lean and efficient manner. SO as I said I predict all the studios that don’t have anything being released in the next year will be the first to go on restructuring.

    #17 2 years ago
  18. CPC_RedDawn

    http://www.pcgamer.com/2012/03/29/thq-lays-off-118-at-relic-vigil-as-warhammer-40k-mmo-dark-millenium-goes-single-player/

    People already lost their jobs back in March.

    I seriously think Company Of Heroes 2 is getting waaaaay over looked here. The South Park game looks great and Metro looks great too. But Company Of Heroes better not suffer from this as I have waited long enough for a sequel to the best RTS game ever!!!

    #18 2 years ago