THQ's Boss Explains, In Plain English, What The Hell Happened To His Company Today

Jason Rubin, the president of beleaguered publisher THQ, has penned a plain and, for the average consumer/fan, incredibly helpful summary of just what happened to his company today.

While the word "bankruptcy" is enough to cause alarm, as it should, Rubin reminds us that along with that move, the company has also been (tentatively, the deal won't be done for 30 days), to a company that's paying all the bills, will ensure THQ's entire slate of products (both announced and unannounced) will hit the market, and will help fund its endeavours in the future.

The most interesting, and re-assuring for THQ employees, comes here:

Whatever happens, the teams and products look likely to end up together and in good hands. That means you can still pre-order Metro: Last Light, Company of Heroes 2, and South Park: The Stick of Truth. Our teams are still working on those titles as you read this, and all other rumoured titles, like the fourth Saints Row, the Homefront sequel, and a lot more are also still in the works.

The "a lot more" bit shows the company is in good enough shape to have projects in the pipeline. You could even wager that one or more these products, like Patrice Desilet's 1666, was looking so good that it helped broker the deal.

The full statement is below:

Today THQ announced that it has secured an investor, a private equity firm named Clearlake Capital Group, who is interested in purchasing most of what you think makes up THQ: the teams that make the games (Relic, THQ Montreal, Vigil and Volition), THQ's Intellectual Property (titles, source code, etc.), THQ's contracts (like the ones with Crytek, South Park Digital Studios, 4A games, Obsidian, and Turtle Rock) and the support staff that are required to help the teams succeed.

In fact, 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.

The sale needs to be completed through a Chapter 11 proceeding of the Bankruptcy code, which we filed today. Given the intense speculation that we have experienced in recent weeks and months, this news probably isn't that surprising.

But what does "Chapter 11" mean? What will happen to the games you are expecting? The series you love? And what about the people and teams that make them?

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.

Chapter 11 is a safety net for U.S. companies. American Airlines is currently in Chapter 11 restructuring, yet I flew back and forth on that airline when I visited Volition two weeks ago. Donald Trump and his companies have been in Chapter 11 four times. You can add to that list household names such as Macy's, Eddie Bauer, the Chicago Cubs, Chrysler, Delta Airlines, General Motors, the Pittsburgh Penguins, Marvel Studios, and MGM, among many others.

MGM filed Chapter 11 two years ago, and this year it released "Skyfall" and "The Hobbit," two of the biggest titles of the year. That's what I mean when I say new start!

Our Chapter 11 process allows for other bidders to make competing offers for THQ. So while we are extremely excited about the Clearlake opportunity, we won't be able to say that the deal is done for a month or so.

Rest assured that the goal throughout the sale process has been to preserve our teams and our products. So no matter what the outcome in 30 days, as long as we have accomplished this goal, I will be satisfied.

Whatever happens, the teams and products look likely to end up together and in good hands. That means you can still pre-order Metro: Last Light, Company of Heroes 2, and South Park: The Stick of Truth. Our teams are still working on those titles as you read this, and all other rumoured titles, like the fourth Saints Row, the Homefront sequel, and a lot more are also still in the works.

Finally, you might be asking, why would THQ file for Chapter 11 right before the holiday season? Admittedly, the timing is unfortunate. But as we announced a few weeks ago, we have a January 15 deadline approaching for our bank funding. So if you work backwards to allow the necessary time to complete a sale, you end up at this week. Since all of THQ's worldwide employees are off for a week and a half of paid vacation starting Friday for the holidays and will return to work on January 2nd, it hardly matters anyway.

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.

Feel free to tweet me @Jason_Rubin

— Jason Rubin, President of THQ Inc.


Comments

    homeworld? :(

      Homefront :(

      I did the same thing while glancing through this. "There's another Homeworld game in development? Hell ye... oh... well, crap."

    Seems like 38 studios case again. Expecting too much from one single title but did not meet expectations. How about giving us Darksiders 2 FPS fix for PC :(

    "While the word “bankruptcy” is enough to cause alarm, as it should, Rubin reminds us that along with that move, the company has also been (tentatively, the deal won’t be done for 30 days), to a company that’s paying all the bills, will ensure THQ’s entire slate of products (both announced and unannounced) will hit the market, and will help fund its endeavours in the future."

    I think you missed a word in here.

    It would be very interesting if THQ managed to turn this around and come out as the same company. With any luck the Humble THQ Bundle brought in enough to prove to this investor group that there's actual value in not having the gaming public despise you.
    It'd be perfect if THQ came back from this as a very grateful company. It's probably more likely that they'll come back as something like Ubisoft but it sure would be nice to have another publisher that understands treating it's customers well is good for everyone.

      I feel bad for only spending $10 on that now. :(

      In my defence I only wanted it for Metro 2033 which was being offered for free through their FB campaign so I guess they got $10 more than they would have otherwise?... Well $4.50 because the rest went to charity/Humble Bundle...

    How many times has Donald Trump gone "bankrupt"? but he has managed to come out of it smelling of roses every time.

    Its sad to see any video game publisher go down but its lucky it hasn't come to the time for THQ to liquidise all assets which could mean potential disaster for all working under THQ.

      According to the press release, 4 times.

      *The more you know...

    Also so sad when you hear a great company like THQ has to file for bankruptcy but now atleast some good news that they will be sticking around and still releasing games was abit scared something might happen to metro: last light can't wait for that to release.

    Wow! Jason Rubin is an amazing businessman and speaker!
    The attention grabbing headline would make investors sell everything and run for the hills.
    But Rubin actually restored my faith in THQ doing well in the future! He offered examples of top notch games in development (I've got South Park preordered) and explained how a chapter 11 bankruptcy can actually do wonders for turning a company around by comparing it to other successful companies like MGM!!
    His speech actually makes me WANT to buy as many shares as possible in THQ now!! Last week I was thinking THQ wouldn't last until the end of 2013. Now they're looking more confident than ever! Thank goodness for Clearwater!!

    If I could meet Jason Rubin, I would shake his hand and offer to buy him a beer. Great speech. Great businessman.

      It's a common misconception that Bankruptcy = automatically broke and gone. While this is true most of the time a company will also use Bankruptcy to save a company from complete insolvency.

      For a recent example just check out Darrell Lea. It filed for bankrupcy a while back and its now back in business w/ a new investor/owner!

    I feel sorry for Rubin with people blaming him for this. He was only installed as boss a few months ago, after the old one blew all the money with Homefront and uDraw.

    Either way, this still looks bad. Their share price was $65 24 months ago. It's now 36 cents.

    I'm still not holding my breath for THQ's upcoming titles to be released. If they are, they'll probably rush Last Light/CoH2/South Park and then liquidate it all.

    Last edited 20/12/12 6:50 pm

      Actually... chances are THQ will probably be the same (sans a few studios or two) but under a new name. There's a difference between a bankruptcy where u liquidate the assets... and one where you actually get an investor to take over.

      Same thing happened w/ Darrel Lea a month or so back when they filed for bankruptcy. An investor took over and rebuilt the company after cutting off the money lossing products and focused on the money makers. Voluntary Bankruptcy isn't just declaring your "broke" it's also rearranging your assets to see if you can save the company. Normally if you can get an investor to take over then you can restructure the company again and continue. If there are no takers however (like in GAME au) then thats when the painful asset liquidation commences =(

      Lucky for us there's at least an private firm willing to invest in THQ for now. Of course the real challenge is rebuilding THQ after the whole process is finished.

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