Bankruptcy isn't easy as THQ auction delayed and loan denied, next hearing on January 7

MetallicaDragon

Wonderfull, southpark will be delayed even more, or possible canceled even tough the game is completely finished

Yay justice system! Do what your corporate overlords command you to! Glad we know who you work for!

It isn't really looking to corporate over lords so much as it is ensuring that current creditors aren't shafted by a speedy bankruptcy. Disappointing but understandable.

I just hope the employees make it out of this okay.

quote Wakaman

I just hope the employees make it out of this okay.

I agree. Horrible things about companies trying to take the easy way out is getting their employees involved. Nothing worse than losing your job because your company did some horrible financial decisions.

Creditors/financiers should go to hell first before the company goes bankrupt....

Why? They provide creative minds the ability to produce the things we want, and deserve just as much protection as anyone else. Plenty of people work for the banks that loaned THQ money, I guess it would be better for them to get laid off for the terrible choices another company made, right?

It's not like they did anything that terrible, either. They're just saying that a deal made in a back room between THQ and their potential funder may not be the best they can do, rushing things isn't going to help the development studios or their games either.

quote BlackScythe

Yay justice system! Do what your corporate overlords command you to! Glad we know who you work for!

quote THM

Creditors/financiers should go to hell first before the company goes bankrupt....

Creditors and financiers should have high priority, its not as simple as "they have alot of money, they can afford to lose it." They need to be protected by some sort of legislation to facilitate and encourage lending, which is vital in industries such as this. Thats not to mention that most of these companies will likely be superannuation funds for dozens of working Americans.
Also while I sympathise with the employees, its in the best interest of the company overall that they take bids from numerous buyers.

quote bbb7002004

Why? They provide creative minds the ability to produce the things we want, and deserve just as much protection as anyone else. Plenty of people work for the banks that loaned THQ money, I guess it would be better for them to get laid off for the terrible choices another company made, right?

It's not like they did anything that terrible, either. They're just saying that a deal made in a back room between THQ and their potential funder may not be the best they can do, rushing things isn't going to help the development studios or their games either.

quote lKasHl

quote BlackScythe

Yay justice system! Do what your corporate overlords command you to! Glad we know who you work for!

quote THM

Creditors/financiers should go to hell first before the company goes bankrupt....

Creditors and financiers should have high priority, its not as simple as "they have alot of money, they can afford to lose it." They need to be protected by some sort of legislation to facilitate and encourage lending, which is vital in industries such as this. Thats not to mention that most of these companies will likely be superannuation funds for dozens of working Americans.
Also while I sympathise with the employees, its in the best interest of the company overall that they take bids from numerous buyers.

Well, I'm awared that creditors/fiananciers need some sort of protection, but this must not be implemented at the expense of poor workers and above all, insteading of putting millions dollar back into the pockets of the CEOs in the midst of THQ bankruptcy, workers should have some sort of compensation/rights rather than forcing them to accept the ideology of 'pracitsing capitalist greed' that led to the GFC.

It's in the interest of the majority of the public to get some protection that compaines can't provide, in an age of global businees networks, (greedy) international financiers are too big to fail...

No need to sympathise as long as they've millions of dollars in their CEO pockets; I know where their compensation money will go next, i.e. to create another corporate empire at the expense of workers again.

Workers rights must come first!!!

THM I think you are forgetting that creditors also have a large number of workers as well. If they lose money, their companies lose money and they must lay off workers. It isn't anywhere near as simple as you are trying to make it.

Would be interesting to find out what the actual #'s were for the current deal and what that covered in making their debt square, given they don't get to just walk away from their creditors they are giving them something, one just has to wonder if they want to turn a greater profit or vulture the company into bits in the name of exploring options.

In a sense it's pathetic that Chapter 11 often includes vulturing a company to pieces as part of it. "Well you could get 40% more if we dissolved the company entirely and sold off the rights / assets / progress to 25 teams across the world." is how these cases can often develop. THQ doing the deal they did was more for the sake of keeping this ship together vs parting it out to whoever opted the most for each section of the pie. Hopefully better news comes on the 7th,

Fortunately when the deal goes down eventually, we'll have rough numbers of what the creditors were going to get vs what they wanted to flip their investments for. The excuse of "well the poor investment employees" doesn't really work when they were addressing the debt settlements themselves but the companies weren't satisfied with how much they were going to take out of the deal.

quote Nagare

THM I think you are forgetting that creditors also have a large number of workers as well. If they lose money, their companies lose money and they must lay off workers. It isn't anywhere near as simple as you are trying to make it.

Laying-off workers is inevitable in some circumstances for private companies, even for the government organisations; that's understandable, if they have to sack workers/contractors from the creditors/finance companeis, then some forms of compensations must be initiated before the greedy CEOs of finance companies took millions of dollars which can spent justly for some working-class folks in thier daily survival!

Yes, sacking is common in every capitalist nation. It's obivious that you don't realise that I'm emphasising the (fundmental) rights of workers compared to the potential greed of creditors/ CEOs. This is a complex problem; therefore, no magic formula can be applied but some rights are inalienable for workers. We're not living in the middle age!!

quote THM

Well, I'm awared that creditors/fiananciers need some sort of protection, but this must not be implemented at the expense of poor workers and above all, insteading of putting millions dollar back into the pockets of the CEOs in the midst of THQ bankruptcy, workers should have some sort of compensation/rights rather than forcing them to accept the ideology of 'pracitsing capitalist greed' that led to the GFC.

It's in the interest of the majority of the public to get some protection that compaines can't provide, in an age of global businees networks, (greedy) international financiers are too big to fail...

No need to sympathise as long as they've millions of dollars in their CEO pockets; I know where their compensation money will go next, i.e. to create another corporate empire at the expense of workers again.

Workers rights must come first!!!

On a moral basis I would prefer that the workers get the money, from a business standpoint its not practical though. Lowering the priority of creditor and financier claims increases the perceived risk in event of liquidation, the result would be higher interest rates and reduced financial availability which ultimately leads to reduction in funding of new initiatives since its either to costly/risky to undertake.

No company is too big to fail, that was one of the lessons from the GFC. Also financiers/creditors aren't necessarily huge corporations, there will undoubtedly be some smaller companies/private shareholders caught up in this.

Also, the priority schedule is not as bad as you think, listed in order of payment priority:

Liquidators costs
Creditors with fixed charge over assets
Costs incurred by an administrator
Amounts owing to employees for wages/superannuation (director limit $2000)
Payments owing in respect of workers's injuries
Amounts owing to employees for leave (director limit $1500)
Retrenchment payments owing to employees
Creditors with floating charge over assets
Creditors without security over assets
Shareholders (Liquidating distribution)

So overall employees come out better than creditors without securitised assets in the event of a liquidation and financiers (floating charge and shareholders) bear the brunt of the loss, not to mention that the CEO has a wage cap. So basically looking for a higher bidder will be beneficial for employees, creditors and shareholders, not to mention that its just good corporate governance to prevent management from doing anything dodgy.

THM, the creditors are also full business as well and depend on their workers to make the decisions of which companies to invest in. When a company begins to tank, they need to try and make their money back or as much as possible in order to continue making future investments. Without them in the first place, THQ would have died longer ago and the workers that have been hired in recent years would never have a job in the first place.