The US arm of Atari has filed for Chapter 11 bankruptcy as it looks to detach itself from its debt-laden French parent.
According to an LA Times source, leaders of Atari's North American operations hope to find a buyer to take the company private before focusing the business on products for digital and mobile platforms.
While profitable for the last two years ($11 million and $4 million), Atari's revenue slumped 43 per cent in fiscal 2011 and 34 per cent in fiscal 2012.
Shares in Atari have fallen from more than 11 Euros in 2008 to less than 1 Euro, and the company's growth potential has reportedly been hampered by its heavy reliance on a London-based credit firm for cash.
This is the situation that the US arm, which has 40 employees, is said to want to break free from, and if Chapter 11 is successfully completed, the North American business could emerge with its own resources and little or no debt.