Gasp! Midway announced today that it’s filed for voluntary petitions in U.S. Bankruptcy Court for the District of Delaware for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The filing is only for Midway’s U.S. divisions, and not their other divisions such as the European.
“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.”
Midway is hoping that the Chapter 11 file will allow them to go about their business as usual. However, Midway is still seeking approval from the court for a variety of First Day Motions enabling the company to going about as they usually do. Approval is regularly granted, though.
MIDWAY’S U.S. OPERATIONS FILE FOR CHAPTER 11 REORGANIZATION [Midway]