Redstone to sell Midway stake for $100K

by Jason Dobson { Dec 1st 2008 at 9:55AM }

The week begins with more bad news for financially-hobbled Midway. Just days after finding itself on the business end of a delisting notice from the New York Stock Exchange, the company's majority stockholder, Sumner Redstone, is now preparing to row away from the sinking ship entirely. According to the Wall Street Journal, Redstone and his holding company, National Amusements, hope the separation will help breathe new life into the firm's suffocating $1.6 billion in debt.

Redstone is expected to ~~inflict~~ sell his 87% controlling stake in the troubled publisher to private investor Mark Thomas -- obviously someone who enjoys a good fixer-upper -- for the bargain basement price of about $100,000, or $0.0012 a share, well below Midway's previous closing price of .38 a share. The WSJ also points out that the sale is but one point in what has become a highlight reel of bad investments for Redstone, who sunk millions into Midway in hopes of the company's heroic return, only to see it do a fatality on his bank account.

Tags: debt, investing, investment, midway, money, redstone, stock, sumner-redstone, sumnerredstone

Reader Comments (Page 1 of 1)

giantenemycrab @ Dec 1st 2008 10:06AM

It's kind of odd to think that for $100k I could have owned the video game company that helped shape my childhood... Or a Corvette!

John Z @ Dec 1st 2008 11:05AM

It's also exceptionally sad to realize that the Corvette will retain value better than Midway.

Markez @ Dec 1st 2008 10:14AM

Why, that picure of a sinking ship looks better than the graphics in GoW2!

xGeneral DEATHx (Mr ESC Welcome Back Party Ultimate Mega Action Force) @ Dec 1st 2008 10:19AM

Is it still socially acceptable to put "Zing!" in posts here?

If the answer is yes...

...Zing!

Wiinterfang @ Dec 1st 2008 10:29AM

yeah it's from their new game Bankruptcy, it's in 34D and it's looks and plays so real than most of don't even know we are playing it right now.

J.Goodwin @ Dec 1st 2008 10:15AM

Actually, the $1.6 billion is the total debt for National Amusements, which was the holding company that included Midway Games among others.

The amount that was paid was $100,000 plus $70 million in assumed debt.

87% of 92 million outstanding shares ~= 80 million shares.

$70,100,000 / 80,000,000 = $0.87625 per share which is more than double the current market value of the shares. Redstone got a good deal, as long as the stock price doesn't go up above a buck.

J.Goodwin @ Dec 1st 2008 10:21AM

Not that you could sell 87% of the shares in a company at it's current market price anyway, the price would drop precipitously.

I expect Midway to go into a reorganization bankruptcy, close a couple studios and walk out pretty much unscathed. Being under new management will help a lot.

They already closed Austin and LA, so I'd guess the next on the chopping block would be either Newcastle or Surreal.

Wiinterfang @ Dec 1st 2008 10:16AM

I can't stop laughing at the fatality joke.

Shmil @ Dec 1st 2008 10:21AM

TOASTY!

SoulBlade @ Dec 1st 2008 10:23AM

Clearly they have not experienced the top secret title that is MK vs. Carebears

Brazell @ Dec 1st 2008 10:26AM

hahahahaha... $100,000!?

I... could buy Midway.

Lord Negatron @ Dec 1st 2008 2:26PM

Thats the estimate Sumner Redstone is selling his share for. Midway is still worth more than $100K, i assume.

SpydaKat 17 @ Dec 1st 2008 10:44AM

FINISH HIM!!

Wiinterfang @ Dec 1st 2008 3:45PM

OOOOOOUUUUUUUUU!!!

SpydaKat 17 @ Dec 1st 2008 6:03PM

Recession Wins

phobic99 @ Dec 1st 2008 11:15AM

At least MK vs DC was a hit... oh wait.

495729g @ Dec 1st 2008 11:16AM

J.Goodwin:
You're probably right, but just so you know, the Austin studio isn't quite closed. An Austin project was killed, but the studio is still hard at work on other projects.

And, technically, the LA studio was absorbed into Midway's west coast HQ - San Diego.

Duke @ Dec 1st 2008 11:21AM

Hard at work you say? On the new 4D super duper secret project?

I have to wonder...do you work for Midway?

Goku (aka Ska Chocolate Chip Cookie) @ Dec 1st 2008 12:19PM

It really does suck that Midway is going down like this. I mean jeez, the people brought MK damn it!

Lord Negatron @ Dec 1st 2008 2:21PM

/sarcasm

Ha! Redstone you fool, once Midway releases NBA JAMz: The Big Ballerz Edition, it will bounce back selling hundreds of millions. By then its back in the NYSE and bringing life back into Arcades across the world.

All we need are high flying acrobatics and fiery basketballs. (a little bling also??)

:P