Things aren’t getting any better for THQ, but they’re certainly getting more interesting. After filing for bankruptcy last month, THQ has slowly but surely been making its way towards an acquisition by investment firm Clearlake Capital. Apparently, the bankruptcy court has determined that the deal in place for the acquisition of THQ (along with all of its assets and liabilities) was a little too good, given the estimated value of the company itself.

Instead, bids will be opened up to all other parties, with the bidding process set to begin on January 22, 2013. Rather than selling the company in essentially one large chunk, THQ’s individual assets will be auctioned off one by one.

There is still a chance that Clearlake can come up with enough money to buy THQ outright, but since the truth of the matter is that large companies can often be worth less intact than the sum of their individual parts, that result is unlikely. In other words, selling off individual properties to several different buyers could bring more total money to the publisher’s bondholders than a lump sale. And the bankruptcy court’s mandate, after all, is to ensure as much money as possible for THQ’s unsecured creditors.

The latest report on the ruling to delay the sale to Clearlake comes from DDI, having followed the proceedings for some time. Come January 22, any rival publishers will have their opportunity to place a bid on existing intellectual properties owned by THQ. Electronic Arts and Warner Bros. Interactive have both been mentioned as interested parties, with Ubisoft having expressed interest in acquiring THQ properties when trouble was first brewing.

Darksiders 2 Reviews

Before anyone immediately begins thinking of a Saints Row, Company of Heroes or Darksiders license falling into the hands of Ubisoft, EA or Activision, the fact that rival publishers have two weeks to determine their bids means just about anything is possible. And when considering that THQ’s individual studios are also going to be on the auction block, the possible results are far more intriguing.

While some cynics in the gaming industry might believe that a video game franchise banks on its name alone, the past few years have seen a few cases of quality beating out quantity. Buying the rights to the Darksiders series, for example, without also acquiring developer Vigil Games could prove risky. With the most successful of THQ’s series (generally achieving such distinction based on its development team) being the most coveted, it stands to reason that the purchase of attached studios will also be up for discussion.

Interested publishers all have existing talent and studios with which to bring renewed perspective to even established franchises, but Relic Entertainment and Vigil Games (even without its co-founder Joe Mad) have proven their potential in the past. Their individual project leads could be recruited after their studios are possibly dissolved, but it might just be easier to buy the talent en masse, without any of its bureaucratic baggage.

Saints Row 4 In Development Rumor

The prospects for Darksiders 3, Saints Row 4 or whatever THQ’s Montreal studio is up to are not so promising. THQ’s leadership has claimed in the past that development was unaffected by publisher woes, but the upcoming auction isn’t something they’ve encountered yet.

We’ll all have to wait and see how this drama shakes out, but for now, what do you hope to see come out of all this? The studios survive under other publishers, or the most promising IPs go to even more talented studios? Sound off in the comments.

We’ll keep you up to date on THQ‘s bankruptcy proceedings as they happen.

Follow Andrew on Twitter @andrew_dyce.

Source: Distressed Debt Investing

tags: THQ