Video game company Atari SA said it filed for bankruptcy protection in Paris and New York on Monday after it failed to find a successor to main shareholder and sole lender BlueBay as it wrestles with tough market conditions.
The U.S. operations plan, in addition, to separate from their French parent to seek independent capital to grow in digital and mobile games, Atari Inc said in a statement.
The U.S. businesses plan to sell or restructure all or almost all of their assets in the next three to four months and are seeking $5.25 million in financing from Tenor Capital, Atari Inc added.
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Atari SA said it had taken the steps to protect itself from creditors as its credit facility with BlueBay was due on March 31 and because of the "strain on cash resources" due to "adverse trading conditions and limited development funds".
Atari SA said no investor had been willing to replace BlueBay as its reference shareholder and main creditor because of its French listing, complicated capital structure and the difficult economic and operating environment.
The company said it owes 21 million euros ($28 million) to BlueBay.
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Atari SA Chief Executive Jim Wilson said the company's decision to seek bankruptcy protection was the best option to protect the company and shareholders, and said it would seek to maximize proceeds.
Atari Inc added: "The Chapter 11 process constitutes the most strategic option for Atari's U.S. operations, as they look to preserve their inherent value and unlock revenue potential unrealized while under the control of Atari SA."
Atari's game titles include Pong, Asteroids, Centipede, Missile Command, Battlezone and Tempest.
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