
Surprisingly this story is from 2013 and not 1985
via CNN Money:
The U.S. arm of Atari, the iconic video game company that created "Pong," filed for bankruptcy on Monday.
But Atari will live on. The move is aimed at
breaking the American branch away from its unprofitable French parent
company.
In particular, Atari U.S. is looking to "secure
independent capital for future growth, primarily in the areas of digital
and mobile games," the company said in a written statement.
Over the next three to four months, Atari U.S.
will seek buyers for some of its assets, including the Atari logo and
the company's games catalog. Atari as a whole owns or manages more than
200 games and franchises.
The gaming landscape has changed dramatically
since Atari was founded in 1972. Atari scored hits with groundbreaking
gaming consoles and classic titles like "Pong," "Centipede" and
"Asteroid," but later lost its dominance to rivals like Nintendo. The
brand has bounced around through several different owners.
France's Infogrames Entertainment acquired a
stake in Atari in 2000, then bought out the company in 2008 and changed
its name to Atari S.A.
Since then, the rise of casual gaming on PCs and
mobile devices has cut into the video game industry as a whole. Atari
S.A. has been unprofitable for years, and
warned just last month that it will book a "significant loss" for its fiscal year 2013.
The biggest headache for Atari S.A. is the
suspension of its credit line with BlueBay Asset Management. Atari owes
21 million euro ($27 million) to BlueBay, with the balance due on March
31. The company says it is "starved for funds" and hasn't found another
principal creditor to take BlueBay's place.
The New York-based U.S. arm wants to be free of
its French baggage. Atari U.S. said it will "conduct its normal business
operations" during the bankruptcy proceedings, and it's been approved
for $5 million in debtor-in-possession financing from Tenor Capital, a
firm that specializes in distressed lending.