Acclaim Entertainment
From Invertopedia, the encyclopedia of how things fail
Acclaim Entertainment was a New York video game publisher founded in 1987[1]. On September 1, 2004, it filed Chapter 7 liquidation, listing debt of more than $100 million against assets of $10 million to $50 million[2][3]. It had failed to secure a $65 million replacement loan[2], had gone without hit games, and licensees including Mary-Kate and Ashley Olsen and Dave Mirra were suing it[1].
What happened
| 1993 | Share price peaks at $30.[1] |
|---|---|
| Aug 20, 2004 | The credit facility with GMAC expires and is not extended.[1] |
| Late Aug 2004 | A $65 million loan attempt fails. The Glen Cove, Austin and Manchester offices close, and employees are locked out.[2] |
| Sept 1, 2004 | Acclaim files Chapter 7 in Central Islip, New York.[2][3] |
The kill shot
Acclaim's GMAC credit line expired on August 20, 2004, a $65 million replacement loan attempt failed, and the company had no hits to fall back on.
Its assets totaled of $47.3 million against liabilities of $145.3 million[1].
The inversion
A publisher that lives on one lender and the next hit has two things that can end it. Fund the gap before the line comes due.
References
- ^ “Game Publisher Acclaim Files for Bankruptcy”. Animation World Network, September 2004. GMAC expiry, lawsuits, balance sheet, founding year and share price.
- ^ “Acclaim Officially Files For Bankruptcy”. Game Developer, September 1, 2004. Chapter 7 filing, the failed $65 million loan and office closures.
- ^ “Acclaim bankruptcy now official”. GameSpot, September 1, 2004. Chapter 7 filing and the debt and asset ranges.