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Wells Fargo, THQ Reach Temporary Loan Agreement
The embattled publisher released a statement today announcing an agreement reached with Wells Fargo. The financial institution "has agreed to forbear from exercising its rights and remedies against THQ" for previous defaults on loans made to the publisher.
Wells Fargo could reevaluate its decision to not pursue those nuclear options on January 15, 2013. In the meantime, the company is making additional loans to THQ.
THQ also announced that it has begun "entered into exclusive negotiations with a financial sponsor regarding financing alternatives which may result in, among other things, significant and material dilution to shareholders." That's bad news – THQ could sell off valuable assets or take other action to secure financial relief that has the side effect of tanking its shares' value.
Finally, the press release notes the resignation of THQ chief financial officer Paul Pucino – with no replacement waiting to take over. FTI Consulting will assist THQ's finance and accounting departments moving forward.
Cross your fingers, everyone. I'm no financial analyst, but it's hard to see any sunshine in this news other than what's noted in the headline above.
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