THQ failed to obtain approval of a loan to help fund operations and lost its bid for a quick bankruptcy sale. At a hearing Friday in Wilmington, Delaware, U.S. Bankruptcy Judge Mary F. Walrath ruled in favor of creditors that the sale process didn’t give potential buyers enough time.
“I have problems concluding that the pre-petition sale process was fulsome,” Walrath told lawyers at the hearing, noting THQ “did not even put out to the public that it was for sale” until potential buyers signed non-disclosure agreements.
According to a report by Bloomberg, about 10 potential buyers contacted THQ after finding out about the sale from its bankruptcy filing.
THQ, WWE’s video game partner, filed for chapter 11 bankruptcy protection on December 19th with a deal in place to sell most of its assets to Clearlake Capital Group LP in a deal valued at about $60 million. The company sought approval to hold an auction on January 9th with potential buyers submitting bids by January 8th, followed by a January 10th hearing to approve the sale. Creditors want the process extended by about three weeks.
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