As anticipated, Midway has announced that the company has had to make a “difficult but necessary decision” as it filed for Chapter 11 bankruptcy today. The creator of the Mortal Kombat series said the filing was due in part by a change in ownership last fall when shareholder Sumner Redstone sold off his controlling stake of 87% in the company for a paltry $100,000 plus $70 million in debt.
This triggered a provision that allowed Midway's debtors to ask for full repayment of a $150 million investment, which originally wasn’t due to be repaid until 2025 and 2026. The company says that filing for Chapter 11 is the “next logical step” in its reorganization process, that it expects to continue doing business as usual and is seeking court permission to go on managing its own operations.
Meanwhile the company’s forthcoming open world racer featuring Vin Diesel, Wheelman, may be the first title to be affected by the move, with Kotaku reporting that the has found a new home at Ubisoft.