THQ hires M&A consultant as finances worsen

THQ hires M&A consultant as finances worsen
Seth Tipps

By Seth Tipps

November 6th 2012 at 1:51AM

Centerview Partners' engagement a sign beleaguered publisher is looking for buyers

THQ has brought in a prominent mergers and acquisitions consulting firm to help advise the troubled publisher, the company's CEO Brian Farrell revealed in THQ's earnings call.

The company has helped broker several major company buy-outs, and as THQ has identified itself as being in serious need of capital, there is a strong possibility the company is seeking a buyer.

It isn't just a need for coin that would drive THQ to the auction house, as Farrell pointed out the company also has $100 million in face value of convertible notes outstanding and due in less than two years.

“In order to help us address these challenges, we have hired Centerview Partners to evaluate our strategic alternatives,” said Farrell.

Exactly what these alternatives are if not a buy-out was left to the imagination, as THQ had been advised to conclude the earnings call without a Q&A session.

Possible options include more restructuring, or selling off assets, but THQ is in dire need of revenue after drastic cuts to its product line-up.

These cuts lowered the operating loss from $92 to $21 million from the same period last year, but without a comparable list of products hitting shelves, revenues also fell from $146 to $92 million.

The pressure on THQ to make every dime count has forced the publisher to delay its entire Q4 2012 lineup, a decision President Jason Rubin acknowledged brought additional risks.

“Clearly, THQ faces a number of opportunities and challenges,” said Farrell.

“I am confident about the opportunities that lie in our robust slate of games and in our studios. But we also face challenges operating with limited capital resources in the highly competitive market for games, and we are working diligently to resolve those challenges."