Midway Games announced today that it lost $US 34.8 million last quarter, which members of the financial community often refer to as "not so good". That's a considerable jump from the same quarter last year, in which Midway lost $US 14.3 million. Unless you're a Midway share holder and concerned about the loss of $US 0.38 per basic and diluted share, you're probably more interested in a screen shot of Johnny Cage trying to nut punch a baby.

So, what did Midway release in the second quarter? NBA Ballers: Chosen One for the PlayStation 3 and Xbox 360, for one thing. It also lists the European release of Unreal Tournament III for the PS3 as one of its "operating highlights".

It expects things to look a little better for the next few months, with TNA iMPACT! contributing to an estimated $US 52 million in revenue. You know, they should really put some actual T & A in that game instead of focusing on oiled-up dudes. That'd sell, like, hundreds.

On June 3rd 2008 2:30PM Japan Standard Time, Tomonobu Itagaki announced that he was leaving Tecmo and also suing the company for unpaid bonuses. He cited an unfulfilled Dead or Alive 4 completion bonus, stating, "President Yoshimi Yasuda chose not only to violate this agreement, but also turned defiant, telling me 'if you are dissatisfied with the decision not to pay the bonuses, either quit the company or sue it.'" How did that effect the company stock price? The following day, the price of Tecmo stock suddenly dropped 10.16 percent in Japan. Think of it as a shuriken to the market cap.

Stock Prices Drop [Excite News] [Pic]

In an SEC filing, Atari reported that its delisting from the Nasdaq is official. Trading of the company's shares was suspended this morning at market open.

The company said it will appeal the decision, bringing it before Nasdaq's Listing and Hearing Review Council. At the same time, Atari is going ahead with previously-announced plans to merge with Infogrames, its majority shareholder, who is also loaning the company $US 20 million in required capital.

The company received a notice in December 2007 that it had to maintain a market value of $US 15 million or more for at least 10 business days, which it was unable to do. On March 24th, 2008, the Nasdaq notified Atari that it would be delisted unless it requested a hearing - it did, and that hearing, held on May 1st, failed to swing things Atari's way, and the Nasdaq ruled to proceed with the delisting process.

Full announcement follows the jump.

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After what feels like years of threats, Atari have finally been handed a delisting notice from the Nasdaq stock exchange, after the company failed to raise the $US 15 million in market capitalisation it needed to stay the executioner's axe. An appeal's already been lodged, citing parent company Infogrames offer of a total buyout, but, yeah. Things don't look good. Guess Misseur Directeur Général Délégué has his work cut out for him. Those with a morbid fascination for death rattles can read Atari's full statement after the jump.

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So Take-Two won't play nice with EA's buyout offer? That's fine by EA. Playing it nice was a courtesy, an act of politeness on their part, but in light of Take-Two's reluctance (and some would say greed), they've now no other option. It's (apparently) time to go hostile, and appeal directly to Take-Two's shareholders. The Wall Street Journal report that EA's takeover payout to shareholders will be... $US 26 per share, exactly what was offered to Zelnick & co. the first time around. There's been no comment as of yet from anyone at either Take-Two or EA regarding the matter.

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French company Infogrames are Atari's majority shareholder. Looks like they're soon to be their only shareholder. A letter has arrived at Atari HQ from Infogrames, no doubt signed in a beautiful, flowing script by the company's new Directeur Général Délégué, indicating their desire to buy any and all remaining Atari stocks for $US 1.68 per share. Atari don't have to accept, but then again, they don't exactly have the strongest of bargaining positions at the moment.
Infogrames offers to buy Atari Inc. [GI.biz]

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SCi, developers of Tomb Raider, Hitman and Deus Ex, have canceled 14 of their projects and plan on laying off 200 people and cutting their annual operating costs by £14 million as part of a company restructuring plan meant to get SCi back on track.

"Following our business review over the last six weeks, we are initiating a clear action plan based on three fundamental strands of activity: a radical change in our structure to a studio-led business, a top to bottom programme of product improvement and efficiency and a considerable cost reduction plan," Phil Rogers, Chief Executive of SCi Entertainment Group said, in a prepared statement. "To get SCi on track we have to act rapidly and effect change quickly. We must allow the world-class people that we have within the Group to focus on strong, profitable titles which will create the value our shareholders deserve."

A chief part of that plan is a fundamental change to the way the company does business with SCi shifting from the current centrally-controlled development and publishing model to a studio-led one, similar to the labels model that EA moved to last year.

Under the new structure, SCI would have studios based around "cornerstone products" like Tomb Raider, Hitman, Championship Manager and Deus Ex. The company is also creating an Eidos PLAY studio which will "fuse together casual and new media resources." Finally, production services will form part of the studio group and be relocated to Montreal from London.

I blame the Wii... well that and a company that has essentially been living off of three franchises for nearly two decades.

SCi Corporate

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No legal action is recommended against publisher THQ, following an investigation by the United States Securities and Exchange Commission into some of their stock option practices. The investigation began back in August 2006, when the SEC requested all documents and materials pertaining to the practices, dating back to 1996. THQ was already in the process of conducting a voluntary internal review, and says that their independent investigation, which concluded January 2007, showed no evidence of fraud or misconduct. THQ was just one of 60 companies being investigated, including Activision and Take-Two.

SEC chooses not to recommend action against THQ [Gameindustry.biz]

The seemingly inevitable acquisition of Take 2 by Electronic Arts is having an impact on more than just those two. The move, which comes only a few months after Activision teamed up with Blizzard, has set investors hearts aflutter at the prospect of further mergers/acquisitions, with the stocks of three troubled publishers - THQ, Atari & Midway - seeing huge gains (around 10% each) on the back of the EA/T2 news. While Phil Harrison might console himself with the thought it was rumours of his switch that propelled Atari's spike, the more probable explanation is that those are the three publishers most likely to be snapped up if a big buyer enters the gaming market.
THQ, Midway, Atari stocks surge on EA's bid for Take-Two [Variety]

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On Friday, shares of Take-Two Interactive Software (TTWO) were trading for $17.36 a share as of market closing. Then over the weekend EA made its bid for Take-Two public, releasing details of a proposed buyout at $US 26 a share to various news outlets including Kotaku, even going as far as to open a website dedicated to their proposal. Well surprise, surprise, this morning TTWO opened at $US 25.75 a share - 47% above the last closing. Shares are going fast too, with massive chunks being sold off at a time. Over the past 3 months the average trade volume for the stock has been around 1.8 million a day. As of this writing, 12.5 million shares have already changed hands. So what does this mean? Stockholders believe this buyout will happen. So do arbitrageurs - companies that buy up huge amounts of stock for the chance at making small yet high volume profits. In other words, these companies believe so strongly that the $US 26 a share offer will go through that they are willing to buy up huge amounts for the chance at making $US .25 profit a share. I dunno folks, this looks like it could very well happen. Hold me.

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