Infogrames Manages Short-Term Debt, Dismisses Takeover Rumors
French-headquartered publisher Infogrames, the owner of the Atari brand and Atari Inc. in the United States, revealed today that it has secured a deal with bankers that will fund its 2004 holiday season. Infogrames has had concerns raised over its repayment of significant longer-term debts, with 117.1 million euros in convertible bonds currently due to be repaid during 2005.
CEO Bruno Bonnell also confirmed, via a phone interview with Reuters, that Infogrames/Atari is not currently in active discussions to be bought out, dismissing rumors that surfaced during the day. This came alongside word that Infogrames is working on refinancing the aforementioned 2005 bond, one of the likely reasons that the company might be vulnerable to financial overtures in the first place.
Going into greater detail, Infogrames' shorter-term debt issues were indeed resolved by the deal announced today with finance firm Nexgen Capital Limited. The deal, which saw Infogrames redeeming $26.1 million of the $28.2 million owed to Nexgen Capital Limited, has the company transferring 10.6 million Atari shares to Nexgen with a one-year maturity date.
As of the close of French markets, Infogrames' share prices rose by just 0.71 percent, a tiny amount, but slightly more promising compared to the 70 percent the shares have dipped in 2004. Atari's NASDAQ-traded U.S. shares are also up 17 percent to $1.50 on the news, but are down from around $4.00 since the start of the year.
Atari/Infogrames' forthcoming financial results, due November 4th, will be crucial for the company, since the long-delayed, recently released Driver 3 has the potential to make or wreck the company's fortunes, going into a crucial Christmas period where they lack major new releases.