The American arm of publisher Midway Games has filed for chapter 11 protection in the bankruptcy court in Delaware today. The decision has been made in order to attempt an re-organisation of the company without the pressure of having to pay off the many creditors straight away.
Here are a few optimistic quotes from the press release, but make no mistake filing for chapter 11 isn't a like waving a magic wand to make things better. Tough times are ahead for Midway.
"This was a difficult but necessary decision," said Midway Chairman, President and CEO Matt Booty. "We have been focused on realigning our operations and improving our execution, and this filing will relieve the immediate pressure from our creditors and provide us time for an orderly exploration of our strategic alternatives. This Chapter 11 filing is the next logical step in an ongoing process to address our capital structure."
"Midway enters this process with strong underlying fundamentals, as evidenced by solid fourth quarter sales that exceeded expectations in spite of a challenging retail and general economic environment," Booty added. "Overall, Mortal Kombat vs. DC Universe sales are approaching two million units shipped, TNA iMPACT! has shipped approximately one million units, and our Game Party franchise has sold close to three million units in total."