Midway gets credit extension
Mortal Kombat vs. DC Universe publisher now has until February 19 to pay back $75 million, in talks with remaining debt holders.
Last month, Midway Games revealed that it was carrying a crushing debt load of $240 million--$167.5 million more than the company's total assets as of September 30. Worse still, it looked as if the once-mighty Mortal Kombat publisher had only until mid-January to repay the debt. After that date, holders of $150 million in loans could demand immediate repayment from Midway--a repayment that, by its own account, the company could likely not come up with.
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Apparently taking the age-old adage "You can't get blood from a stone" to heart, some of Midway's creditors are extending its payment deadline. According to an 8-K form filed with the Securities and Exchange Commission this morning, the publisher now has until February 19 to pay down $75 million of debt--or half of the $150 million due next week.
As for the other $75 million, a senior Midway rep told GameSpot that his company is in talks with the owners of the debt. "We're making progress getting our bondholders to agree," said the rep, who emphasized the debt negotiations won't affect the February 16 release of The Wheelman. "We're still on track for that," he said.
Though Midway's financial situation is grim, it's not completely hopeless. In mid-December, it took drastic steps to cut costs by laying off 25 percent of its staff, canceling "non-core" projects. The company is also expecting a boost of revenue from the highly anticipated, decently reviewed comic/fighting-game crossover Mortal Kombat vs. DC Universe, which went on sale in mid-November.
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