|THQ talking with "financial sponsor" over troubles, "no assurance" of deal|
|Posted: 21.11.2012 13:34 by Simon Priest||Comments: 2|
THQ is once more in financial straits but there have been positive events recently as they've managed to secure a forbearance agreement with Wells Fargo Capital Finance until January 15th, 2013.
That means the $50 million on credit won't be exercised against THQ, and additional loans will be made. Also the publisher is in talks with a potential "financial sponsor", but nothing is certain.
"There can be no assurance these negotiations will result in a transaction,” warned THQ. The company is cautiously optimistic for now, even though CFO Paul Pucin has quit.
"We are pleased to have reached an agreement with Wells Fargo,” said Brian Farrell, THQ boss. “This agreement enables us to continue focusing on bringing our games in development to market. Meanwhile, we are evaluating financial alternatives that will transition the company into its next phase.”
Wedbush Morgan analyst Michael Pachter is much more cynical over the recent agreement with Wells Fargo, and believes it will do little to sway a would-be 'white knight' financier: "Liquidity is a major concern after the most recent round of game delays,” said Pachter.
Company of Heroes, Metro: Last Light and South Park: The Stick of Truth have all been pushed further back and given rather open release schedules for 2013. The past fiscal year for THQ hasn't gone well with three major titles been scrapped, which included Devil's Third and inSane. The company also lost top executive Danny Bilson.
Vigil's Darksiders 2, while critically lauded, has not performed as expected in sales.