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Midway Now Facing February Bankruptcy

by Chris Faylor, Jan 06, 2009 8:37am PST
Related Topics – Midway

Struggling publisher Midway may now have another month before it faces bankruptcy, as some of its investors have agreed to postpone a payback deadline until February 19.

After majority shareholder Sumner Redstone sold 87% of the Mortal Kombat publisher for $100K, investors were able to demand repayment due to the change in control.

All together, Midway faces $240 million in debt, though it is primarily concerned with $150 million of that, which is owned in $75 million increments to two groups of holders. As of December, the company did not believe it could immediately pay the $150 million. Midway originally had until 2025 to repay one group, and 2026 for the other.

Previously, the investors had until mid-January to decide if they wanted their money back. Now, Midway has convinced one group to hold off until February 19, and is attempting to persuade the other group of holders to give it just a little more time.

Midway's remaining $90 million debt is owed to Redstone's theater business National Amusements. Oddly, that debt was not mentioned in Midway's update, perhaps implying that National Amusements may not demand immediate repayment.




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