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January 23, 2013

THQ Studios and Franchises Sold to Multiple Buyers

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Written by: Tyler Colp
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THQ stock split

Ruh-roh.

In what will probably be known as one of the most depressing set of bullet points in video game history, a letter (published by Kotaku) sent from THQ’s CEO and president details the publisher’s end.

The company is submitting the information to the U.S. Bankruptcy Court and will need its approval to finalize the sales.

Sega has agreed to purchase popular Warhammer 40,000 game developer Relic Entertainment. Sega currently has a partnership with Games Workshop to develop Warhammer fantasy games, but it’s unclear what happens to the Warhammer 40,000 rights with this acquisition.

Ubisoft will purchase THQ’s Montreal studio and South Park: The Stick of Truth. This could be subject to change given the recent South Park Studios lawsuit to pull out of the THQ auction altogether. The sale will result in former Assassin’s Creed creative director Patrice Desilets’ return to Ubisoft after leaving in 2010.

Koch Media, owner of Dead Island publisher Deep Silver, will acquire Saints Row developer Volition and the Metro franchise.

The rights to Homefront go to Crytek, who is currently working on a sequel to the 2011 shooter.

Take-Two Interactive will purchase Turtle Rock Studios’ Evolve project.

Distressed Debt Investing, who has been keeping tabs on the auction, has tweeted some currently unconfirmed sales figures for each of the sales. I will update these with official numbers if possible.

  • $544.2k Homefront (Crytek) – via Polygon
  • $26.6 million for Relic (Sega) – via Polygon
  • $2.5 million for THQ Montreal (Ubisoft)
  • $3.2 million for South Park (Ubisoft)
  • $10.8 million for Evolve (Take-Two) – via Polygon
  • $22.3 million for Volition (Koch Media)
  • $5.8M for Metro (Koch Media)

Darksiders developer Vigil Games is no more. According to another one of his Tweets, the company received no bids.

“If you are an employee of an entity that is not included in the sale, we regret that your position will end,” the THQ letter confirms.

As for the other unclaimed properties, THQ “will make every effort to find appropriate buyers, if possible.”

 

Here’s the full letter:

January 23, 2013

 

To All THQ Employees:

 

We now have the answers we’ve been seeking through our financial restructuring and Chapter 11 case. While much will be written, here are the facts of the bids and auction that occurred :

Yesterday morning, we received a competing bid for the operating business, along with Clearlake’s offer, and numerous offers for separate assets.

During an auction process that lasted over 22 hours, the final conclusion was that the separate-asset bids would net more than a single buyer for the majority of the company.

Shortly, we will, present the results to the U.S. Bankruptcy Court, which must concur with our assessment.

The proposed sales of multiple assets is as follows :

  • Sega agreed to purchase Relic
  • Koch Media agreed to purchase Volition and Metro
  • Crytek agreed to purchase Homefront
  • Take 2 agreed purchase Evolve and
  • Ubisoft agreed to purchase Montreal and South Park

We expect these sales to close this week.

Some assets, including our publishing businesses and Vigil, along with some other intellectual properties are not included in the sale agreements. They will remain part of the Chapter 11 case. We will make every effort to find appropriate buyers, if possible.

What this means for employees

We expect that most employees of the entities included in the sale will be offered employment by the new owners. However, we cannot say what these owners may intend, and there will likely be some positions that will not be needed under the new ownership. You should receive notice this week or early next week if the new owners intend to extend employment to you. Please note that the terms of your new employment, including pay and benefits, may be different from the current terms of your employment with THQ.

If you are an employee of an entity that is not included in the sale, we regret that your position will end. A small number of our headquarters staff will continue to be employed by THQ beyond January 25 to assist with the transition. THQ has sufficient resources to pay these employees for work going forward, and we will be contacting these employees immediately to ensure their continued employment during this transition period. We are requesting the ability to offer certain severance pay to minimize disruption for employees of non-included entities as they determine the next steps in their careers.

We know you will have many questions about this news. We’ll be meeting tomorrow when we return to talk through this announcement and to answer any questions you have. You will receive a benefits fact sheet and FAQs with answers to some questions that may be on your mind. Please review these materials closely.

A personal note

The work that you all have done as part of the THQ family is imaginative, creative, artistic and highly valued by our loyal gamers. We are proud of what we have accomplished despite today’s outcome.

It has been our privilege to work alongside the entire THQ team. While the company will cease to exist, we are heartened that the majority of our studios and games will continue under new ownership. We were hoping that the entire company would remain intact, but we expect to hear good news from each of the separate entities that will be operating as part of new organizations.

For those THQ employees who are part of entities that are not included in the sale, we are confident that the talent you have displayed as part of THQ will be recognized as you take the next steps in your career.

Thank you all for your dedication and for sharing your talent with the THQ team. We wish you the best of luck and hope you will keep in touch.

Sincerely,

Brian Farrell

Chief Executive Officer

 

Jason Rubin

President

Source: Kotaku, DDInvesting



About the Author

Tyler Colp
Tyler Colp is a writer at SideQuesting. He's into dying, restarting, intentionally going the wrong way, and accidentally skipping cutscenes. When he's not talking about games or tech, he's probably confessing his childlike love for Lego.