THQ buys vital time as creditor holds off
20th Nov 2012 | 23:03
Embattled publisher THQ has been given an eight week grace period by is bank lender Wells Fargo, having previously defaulted on repayment plans from a $50 million loan.
Wells Fargo, which could have blocked further sponsorship or perhaps taken action that would have left THQ within touching distance of bankruptcy, has instead decided to hold out to allow the publisher to recover.
Terms of the forbearance deal were not disclosed, though the January 15th deadline was made clear.
"We are pleased to have reached an agreement with Wells Fargo. This agreement enables us to continue focusing on bringing our games in development to market," said the corporation's chief executive Brian Farrell.
But in a further blow to THQ's miseries, the publisher revealed that its chief financial officer has resigned. Paul Pucino, who also acted as executive vice president, departs from the company after four years.
Meanwhile, THQ claims it is closing in on another finance deal with a separate sponsor. The agreement has not been finalised, nor has the sponsor been named, which raises questions over the nature of the publisher's assurances.
THQ claimed that the alleged potential agreement "may result in, among other things, significant and material dilution to shareholders" - perhaps referring in this instance to a buyout from another company.
Ubisoft chief executive Yves Guillemot recently said he was not entirely against a potential deal with THQ, though the language he used was ambiguous. Last year, the two companies were locked in various legal disputes over talent acquisitions across Canada.
In early November, THQ announced a net loss of 21 million, adding to a now infamously long list of financial setbacks at the uDraw publisher.
It has also delayed three games: South Park, Metro Last Light and the next Company of Heroes.