The Auction of THQ

THQ’s financial difficulties have been an interesting, if sometimes heartbreaking story to watch unfold. From its early days as a business focused on licensed titles, to its more modern incarnation as a competing Triple-A publisher, the California based company has long been a major player in the  industry. After a new CEO, and after a controversial Humble Bundle, that’s all come to an end. Following Chapter 11 bankruptcy filings, we received word on January 22nd that the veteran publisher would be split up and its assets sold off, at least in part.

First up, I’ll break the sale down, before looking at what announced or unannounced titles may now never see the light of day.

The Sale

Despite an initial attempt at an early sale to Clearlake Capital Group, court proceedings have instead resulted in a lengthy 22-hour auction. Speculation placed values on certain assets before the auction was announced, but a fairly solid set of figures for the final prices is now out in the open.

Under the current sale proposals, the following properties and studios will now be owned by the publishers listed.

  • Sega purchases Relic, as well as their Company of Heroes franchise for $26.6 million
  • Ubisoft purchases THQ Montreal, as well as 1666 and Underdog, two registered trademarks attached to unannounced projects in development at the studio for $2.5 million.
  • Along with it, Ubisoft take South Park; The Stick of Truth for a separate $3,265,306.
  • Crytek, of Crysis fame, take the modern combat FPS franchise Homefront for $544,218.
  • Take-Two Interactive nab Evolve, also known as Metamorphosis, another unannounced title for $10.9 million. The game was in development at Turtle Rock Studios.
  • Koch Media take Volition, developers of the Red Faction games, but also Saints Row, a franchise included in a sale price of $22.3 million.
  • Koch Media also take Metro 2033 and Metro: Last Light for a price of $5,877,551

Next-closest bids were as follows.

  • Zenimax tried to grab Relic and Company of Heroes, but their bid of $26.3 million wasn’t quite enough.
  • Turtle Rock Studios, developers of Evolve, tried to net it for themselves at $250k.
  • Ubisoft made what I think is a pretty paltry offer for Volition and Saints Row, at $5.4 million.
  • Ubisoft also tried to take Metro 2033 and Metro: Last Light at around $5.175 million.
  • There were no back-up bids for THQ Montreal, 1666, Underdog, Homefront or South Park: Stick of Truth.

Some of the bids are more surprising than others, although all are worthy of comment. Sega has a good history with strategy titles, such as its publishing of Creative Assembly’s Total War franchise, so Relic and Company of Heroes seems like a good purchase for them. That the developer and series garnered the single biggest purchase price says a lot for the quality of the studio and the attached fanbase, proving that the PC is still a powerful platform.

Ubisoft

Ubisoft already has a heavy presence in Montreal, so expanding their position in the city seems like a logical thing to do. Taking 1666 and Underdog along with the studio developing them doesn’t necessarily mean that those games will ever see release. THQ Montreal was founded in October 2010, before the publisher moved some substantial QA operations to the site from Arizona in 2012, and only registered the trademarks for the two properties last year. New studios take a while to really gear up, as do new projects. Depending on their state of development, I wouldn’t be hugely surprised if the projects were suspended for the time being, and the studio’s focus shifted to franchises like Assassin’s Creed, teaming up with their fellow Montrealers. Then again, Ubisoft paid for the names, so they are just as likely to believe in and be supportive of the new IPs.

South Park: The Stick of Truth is a whole other matter. South Park Studios aren’t happy with the game being included in the sale, as it claims that the agreement isn’t transferable to another publisher. To demonstrate their dissatisfaction, they’ve gone as far as presenting a formal objection with the U.S. Bankruptcy Court.  Expect a delay on the game at the very minimum, if only so new terms can inevitably be worked out with Ubisoft. South Park Studios won’t want to see the project disappear, but they won’t give up without a fight if there is something to be gained by renegotiation.

Crytek

Crytek taking Homefront is very straight-forward, especially at a bargain price. Crytek UK – formerly Free Radical of Haze, and Timesplitters fame – were already working on the sequel to THQ’s attempt have yet another competitor for Battlefield and Call of Duty. At half-a-million, the Crysis people are probably going to do very well out of the arrangement in the long term. At bare minimum, they stop a recently purchased asset from having their game cancelled.

Take-Two

Very little is known about Evolve, but Take-Two have bought a title that has been in the making since at least May 2011, when THQ announced it would be publishing it. Turtle Rock, the developers, attempted to purchase their own game, putting in an unsuccessful offer of $250k, well short of what Take-Two paid. The game is a shooter, and despite the developer’s previous connections to Valve, including its work on Left 4 Dead, is using CryEngine 3.

Koch Media

Koch Media arguably made the biggest splash here. If you don’t know who they are, then look for titles bearing the publisher name of Deep Silver. Risen and Dead Island are probably its most respected and significant products as it stands, but by taking on Saints Row they’ve made a major leap forward. The title is definitely seen as one of the commercial jewels in THQ’s crown, along with the popular Metro games. Honestly, Deep Silver releases a lot of sub-par games, so whether this is part of a wider strategy or a more opportunistic grab remains to be seen. Volition also had a Secret Project Y in development, which may also come with the package.

It’s the presence of Koch Media that really makes the omissions on this list stand out. I can’t believe that neither EA or Warner Bros. thought Saints Row was worth some cash. Maybe the bidding was too rich for them, given that both possess the resources to put their own open-world crime franchises into production, but really? Deep Silver is now the publisher of Saints Row? Absolutely wild.

The Rest

The toughest news is that as of yet, Vigil Games doesn’t have a buyer. Developers of Darksiders, one of their founders, comic artist Joe Madureira had already walked away from the company to return to funny books. They were also the named developer of Warhammer 40K: Dark Millennium, a troubled production that swapped from an MMO project to a presumably single-player effort in 2012. Relic, purchased by Sega, do far more work with Warhammer 40k, so one would imagine that either they now hold the license, or all related projects are now cancelled. With this project being at a different developer, it seems pretty much a given. None of this feels particularly fair for Vigil, who have produced two quality games, but then these things never are.

THQ also have a mobile games division, THQ Wireless. No mention has been made of that, however a letter to staff has suggested that management are still looking to sell off remaining assets. One assumes that there are some unaddressed IPs within that. Red Faction had pretty much run its course, and you presume that it went with its developers Volition, but assumptions are never definite. Likewise, THQ made a statement saying that they had allocated funds to finish development on WWE ’14, but again, that would appear to me as being a bit up in the air right now as Take-Two is poised to acquire the WWE rights.

The Comment

So, that’s a bit of a run-down of things. A connecting of the dots. Giving a bit more personal comment, I really don’t see these sale terms being good for the games industry as a whole. I don’t believe that Deep Silver will step into the space that THQ leaves. The number of publishers in the industry has dwindled in recent years, and THQ had come to be well regarded as a supportive partner. It’s loss is a real one, but there’s some positivity to be found in titles like Saints Row finding new homes.

Best wishes to anybody affected by the redundancies that will follow the proceedings. It looks like Twitter is already responding, with lots of opportunities popping up. Fingers crossed for you all.

About Martin Perry

Martin Perry is Reviews Editor for Splitkick.
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