While THQ would like nothing better than to hand off all of its assets to Clearlake Capital Group for $60 million, several creditors have voiced their opposition to the company's bankruptcy and takeover plans, calling them "unfair and unreasonable." The troubled publisher filed for Chapter 11 bankruptcy protection last month and asked the court to approve a take-over of the company by investment firm Clearlake "within 30 days."
But creditors say that this whole plan is a dodge on the part of THQ and a way for the company's top executives to hold onto their positions. Creditors that include Silverback Asset Management, Third Avenue Focused Credit Fund and Wolverine Flagship Fund Trading Limited hold notes for THQ and have told the Bankruptcy Court that the current deal has "been designed specifically to thwart any potential bidders from stepping forward to compete with Clearlake's bid."
They go on to say that this deal will not maximize the value of THQ, and that the deal was put in place to allow Clearlake to take full control of THQ's whole business, "regardless of whether such a sale is in the best interests of the Debtors' unsecured creditors." The group of creditors also claim that the sale was designed to keep THQ's current management executives in their positions within the company.
"The Bidding Procedures Motion contains scant reference to the discussions and/or agreements between the Debtors and Clearlake with respect to employment of the Debtors' management and employees following the sale, as well as the steps the Debtors took to ensure that the sale process is fair in light of such agreements," it reads. "If the members of Debtors' management are concerned more with retaining 'control' over the Debtors than maximizing the value of the Debtors' estates, their interests clearly conflict with those of the Debtors' unsecured creditors."
U.S. Trustee Roberta DeAngelis, who is overseeing the THQ bankruptcy filing, has objected to the small window of opportunity for potential bidders to make a play for the company or its assets, and that there is clearly a rush to finalize the deal with Clearlake sorted.
The Silverback, Third Avenue and Wolverine complaints add that the company filed during the Holiday season on purpose because potential buyers would be away from the office...
We'll have more on this story as new details emerge.