Troubled U.S. publisher Midway Games has negotiated additional breathing space for its debts, reaching an agreement with the holders of all $150 million of its senior notes. It now has a month to avoid bankruptcy and find alternative sources of credit.
Troubled U.S. publisher Midway Games has negotiated additional breathing space for its debts, reaching an agreement with the holders of all $150 million of its convertible senior notes. The company has been struggling to avoid bankruptcy ever since media billionaire Sumner Redstone sold his controlling stake in the company in December. This triggered a buyback obligation to the company’s bondholders, which could have seen the publisher’s total debt rising to as much as $240 million. Last week, Midway was able to delay $75 million in senior note buybacks until February 19th, 2009. Company execs have now reached agreement on the remaining notes, which now will not be due until February 12th. The notes were originally not meant to be due until 2025 and 2026. Although Midway now has about a month to look for alternative sources of credit, it still faces bankruptcy if it can't resolve or get a new extension on the situation by February.
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