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Atari USA files for Chapter 11 bankruptcy

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While some gaming companies are celebrating a nice profitable holiday season, a handful of them are not. Atari USA is one of those companies and is the second big name in gaming to be filing for Chapter 11 bankruptcy in the recent months. According to Bloomberg, Atari Inc and its 3 subsidiaries has filed for bankruptcy in a move to break away from Atari SA, their French parent company which has failed to make profits since 1999 and is expecting ‘significant loss’ in the latest financial year.

A statement issued notes that the company will continue its normal business operations but (just like what THQ is doing this week) will be selling all its assets over the next 90 to 120 days. Atari is said to owe between $10 to $50 million to creditors and has $1 to $10 million worth of assets; they have been well known for their games (some of which are great classics), such as Pong, Test Drive series, RollerCoaster Tycoon and Dungeons and Dragons.

Naturally, Atari shares in France were driven down by almost 4 percent when the market closed recently and has lost nearly half its value in the last year to 25.4 million euros. A report by the LA Times says a credit lapse at the end of 2012 by financial company BlueBay Asset has left Atari with insufficient resources to release games presently in development.

Atari, as a name and company, has been through many mergers and changes since its inception in 1972. After peaking in the 80’s and 90’s as an arcade and console maker, the company has since slumped into a shadow of its former self due to competition on both the game development and console hardware fronts. Activision Inc and Electronic Arts currently dominate the video game publishing industry while Sony and Microsoft with their consoles have occupied that market space for the past decade or so, and are rumored to have their next-generation of consoles due within the next year.

There’s still hope to this sad news though. Gamers around the world should hope for the best in this move by Atari US to cry for help while it can. Hopefully the buyer(s) of Atari and its assets will bring the company in a more positive direction in the near future.

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