Everyone who ever had one remembers the day that they first played Atari. The Atari system birthed what may be considered the first generation of gamers. The creator of Pong and Centipede among other popular early generation video games has since fallen on hard times.
Atari SA recently filed for Chapter 11 bankruptcy protection in both Europe and the U.S. after failing to find a successor to Bluebay. Bluebay is Atari’s main shareholder and sole lender. With the rough economic times and lean market for the old school games, Atari owes roughly $28 million to Bluebay.
In the U.S. branch’s business plan established through Chapter 11 bankruptcy, they plan to sell or restructure most of their assets and are seeking over $5 million in financing from Tenor Capital. They have a time table of three to four months in which they plan on carrying out this business plan. The plan is structured to protect Atari from its creditors and protect the company and its shareholders while seeking to maximize returns.
Atari views the move towards Chapter 11 bankruptcy as the “most strategic option” for the company to be able to persevere through these difficult trading conditions and economic times while enabling them to uncover new channels of revenue. The goal in filing for bankruptcy is to resurrect the product Atari produces in a new shell. They may not be the same Atari most remember when the resurrection occurs, but they hope that the initial genius engrained in Pong and Centipede will reflect in the next generation of Atari gaming products.
Source: Source: Thomson Reuters, “Atari files for bankruptcy protection,” James Regan (Reuters), Jan. 21, 2013