The US arm of iconic video games developer and publisher Atari has filed for chapter 11 bankruptcy, along with three of its affiliates.
This is seen as a move that could have them break free from French parent company Infogrames which itself is battling with massive debts.
According to a source cited by LA Times, the Atari US business leaders hope to find a buyer and take the company private. Their new business model will focus on digital and mobile platforms.
Evidence suggests that the US Atari operation has been improving, having reported profits for the last two financial years. However, its complex corporate structure as an American company with a French public stock listing means it hasn’t been particularly attractive to investors.
Atari had also been relying on a London financial institute, BlueBay, for US$28-million credit which was keeping the company afloat while it completed games in production – a facility which has now lapsed.
As reported by LA Times, “Atari has secured US$5.25 million dollars in debtor-in-possession financing to continue operations and release games. If Chapter 11 is successfully completed, the U.S. business could reemerge with its own resources and little or no debt to BlueBay.
Source: LA Times
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