Midway sold for nothing and SE looking into Edios

[Wizard]

Midway:

We’re sad to report that employees of Midway Games of Chicago, IL were given more than turkey this Thanksgiving.

 

While most were most likely focusing on stuffing their stomachs with Thanksgiving deliciousness, or perhaps camping out for Black Friday deals, others were working hard to offload controlling shares of the company for next to nothing. This news comes immediately after the launch of their latest Mortal Kombat product, bringing to question if the sales of Mortal Kombat vs DC has failed to live up to expectations.

 

Ultimately, Midway Games was exchanged for mere chump change by media tycoon Sumner Redstone. Just in time for the start of the holiday season, Redstone sold off his controlling shares for a mere $100,000.00 USD to Mark Thomas of Acquisition Holdings Subsidiary, LLC. Considering that Midway Games has a history of well over twenty years behind it as a key player in the world of game development and publishing, the price is initially shocking to say the least. Once one digs a bit further however, it becomes clear that the acquisition package also comes with heaps of debt.

 

The total debt has been reported to be over $150 million in outstanding loans, on top of a $70 million loan which was granted by National Amusements.

 

Beyond debt, with a stock value at well under a dollar per share, Midway facing delisting by the NYSE. To make matters worse, previous quarterly and annual statements have revealed that net income has been in the red, even despite a more solid product lineup in 2007 and 2008. It is entirely possible that Thomas is simply hoping to cash in on the value of the number of IPs which Midway has in its portfolio, instead of coming on to help the company get back on its feet. Among the more recognizable intellectual properties are Mortal Kombat, NFL Blitz, NBA Jam, Smash TV, Rampage, San Fransisco Rush, Galaga, Spy Hunter, and Joust.

 

The swap involved a trade of over 80.3 million shares at $0.0012 per share, far less than the value of each share at prices seen in recent weeks. The transaction is being handled by the New York based Kramer Levin Naftalis & Frankel law firm, although thus far they have released very few details of the transaction itself beyond statements on Thomas’ expected role in the company. All that we know thus far is that Mark Thomas is intending to be as hands off as possible in management and executive affairs once company control has officially switched hands.

 

Time will tell if Thomas has any tricks up his sleeve to help reform and revive Midway, however the details on his desire to remain hands-off leaves us with more concern than hope. With EA Chicago already out for the count, Midway Games remains as one of the few remaining Chicago based developers, and publishers of games. With over 800 employees relying on Midway Games to keep food on the table, we are really wishing for the best.

 

We will of course keep you up to date as we watch the future of Midway unfold, so stay tuned.

Looks like Midway's screwed after all.

 

Lara Croft may have a new boss within the next several months. Struggling British game publisher Eidos could be looking at takeover bids from both Square Enix and Warner Bros.

 

Once considered an elite who couldn’t be bested when it came to action-adventure titles, London-based publisher/developer Eidos Interactive may be taking several bids from companies interested in an acquisition. While Electronic Arts and Ubisoft have expressed interest in the past, the two front runners appear to be Square Enix and Warner Bros.

 

Square Enix, whose success derives primarily from RPGs like the Final Fantasy series, is desperately seeking western talent in order to expand, diversify, and hopefully draw a larger crowd in the American and European markets. SE’s Global President Yoichi Wada recently visited IO Studios in Denmark, the Eidos-owned developer behind the popular Hitman series. After his visit, Wada returned to London to further SE’s negotiations with the house that Lara built.

 

While Square Enix is not to be taken lightly, its late entry into this acquisition foray may put it at a disadvantage. Many are already predicting that Warner Bros. will be the victor because the global entertainment conglomerate already has a 20 percent stake in the London publisher. Back in April, Warner Bros. gave Eidos’ parent company SCi Entertainment GBP $60 million (USD $87.8 million) to keep it from going under. According to mcvuk.com, Warner Bros. Would have to spend another GBP $20 million for a controlling stake in the firm, and thus authority over Eidos.

 

In the event that Warner does emerge as the victor, Square Enix could attempt to buy specific components/assets of Eidos, like IO Studios. Also, if Square Enix fails to acquire Eidos, they would certainly be on the hunt for another Western developer. The attempt to appeal to American and European markets is being driven by John Yamamoto, CEO of Square Enix North America.

 

While Eidos has seen its stock drop around 90 percent over the last year, its latest offering, Lara Croft Tomb Raider: Underworld, has been received well by critics and sits on most top 10 sales charts over in Europe.

TRU is selling well, but the problem is Edios only has ONE franchise keeping them floating. What happened to Legacy of Kain? What happened too... all... there other stuff... Anyways, I hope Warner gets them (very likely as their the ones who've been keeping Edios alive) so they can get some more IPs rolling out into other media. Another TR movie? Sure, do it, Joile will do it. (check out the latest TR game anyways, it's awesome).

 

Sourceblock

[Agozer]

It's sad to see these development studios that were once at the top of their game, come crashing down like this. A large part of the current situation is their own doing, I'm sure, but this whole thing just feels their management isn't the only thing to blame... who knows.

 

And you're right about Eidos too; Eidos has tons of games in thier publisher resume and good for them. The problem is really don't have anything else going for them but Lara Croft, Hitman, and Thief and Kain. Sure, there are some good releases outside of these series (Project Snowblind, Total Overdose, Deus Ex, etc.) but for the most part, a lot of what they've been releasing is mediocre at best, including the console --> PC ports.

[ken_cinder]

I said it somewhere else when the report came that Squeenix wants to buy them.

 

TOMB RAIDER RPG 15 GAME SERIES NOT WANT! GO AWAY SQUEENIX!

 

As for EA....a plain "flock off" will suffice.

 

A footnote on Midway. There are almost a half million shares out on Midway, and 87% of those were sold for $100k. That means PENNIES were paid per share, Midway's current stock value (Or rather as of a couple days ago, I'm too lazy to check again) is 33 cents per share.

Of course, when you also buy 87% of a $70 Million dollar debt, you're not gonna pay market value!

[Gryph]

lol at midway

[Wizard]

maybe cause their games are almost the same with different graphics.

I would say that for Kain and Tomb Raider since their both by the same teams now before Eidos moved Tomb Raider to Crystal Dynamics from Core Design. As for the rest, wtf happened to them.

[Tynvar]

Does anyone that is a fan of video games really play Tomb Raider? The only thing there worth anything is Legacy of Kain. I think we need a new game this gen. I just hope square doesn't over gay the chars like FF.

Edited December 5, 2008 by Tynvar

[Agozer]

Tomb Raider Legend and Tomb Raider Anniversary (or the original whichever you prefer) are awesome. The rest of the series took a huge dive, although the second Tomb raider is still good. As for Midway, their only achievements in my book are Mortal Kombat II, UMK3, and NBA Jam, as well as few good console titles they published but did not develop.

[OverlordMondo]

Holy crap, I just realized something. We need a sequel to Smash TV. Why didn't they do this before? They would've made big money (and possibly also big prizes).

[ken_cinder]

Holy crap, I just realized something. We need a sequel to Smash TV. Why didn't they do this before? They would've made big money (and possibly also big prizes).

 

Psst, see: Total Carnage (Not a direct sequel, but directly based on Smash TV gameplay mechanics and design), oh and Smash TV ROCKS!