Infogrames, the struggling European game publisher and parent company of U.S. firm Atari, has announced its long-awaited new debt restructuring plan, in the latest part of its continuing efforts to continue operations.
The news comes following yesterday's confirmation
that Infogrames shares were suspended on the French stock exchange, apparently due to these very restructuring issues.
Each of the company's board members voted in favor of the restructuring plan, which, if successful “will permit the Company to have a new industrial investment capacity to cope with interactive leisure challenges,” according to an Infogrames statement.
According to Reuters, the company noted that the plan includes a €74 million ($93.9 million) rights issue, in order to ensure that Infogrames will be able to both continue operations and execute on its new financial plan. If successful, the complex plan will result in €55 million ($70 million) in surplus cash on top of eliminating the group's €191.4 million ($242.9 million) in debt.
"This is the final step of the debt restructuring... and a founding step towards a turnaround of the company," Chief Executive Bruno Bonnell told a news conference, according to Reuters.
"What's lacking is an in-depth operating restructuring plan. What the debt restructuring plan does is allow the company to survive," added Exane BNP Paribas analyst Brice Mari. "There are no reasons to feel comfortable with the group's operational situation or the mid-term outlook as Infogrames has sold some of its valuable franchises and studios in recent months."
The company has divested itself
of a number of key properties over the course of the year, including the sale of the TimeShift
to Vivendi and THQ respectively. THQ also purchased Texas-based studio Paradigm Entertainment, while AOL picked up the relatively sought-after Games.com. More recently
, Atari sold its Driver
franchise, along with development studio Reflections, to Ubisoft in its continuing efforts to streamline the company's cost structure.