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12/01/2008 :: Posted at 09:10 PM by DArqueBishop

Sumner Redstone Sells Ownership of Midway to Private Investor

In an extremely surprising move, news came out today that Sumner Redstone, whose National Amusements, Inc. owned 87% of Midway Games's stock, has sold all of its stock to a private investor named Mark Thomas for $100,000 USD. The move comes as Redstone is looking to pay off $1.6 billion USD in debt; according to the Wall Street Journal, this sale would secure a hefty tax benefit.

In addition, the Los Angeles Times is reporting a bit more information, in that the sale may not be as much of a steal as it seems. The company is valued at $30.4 million USD (with shares at $0.33 USD), but currently has well over $150 million USD in outstanding loans, not to mention the $70 million USD loan from National Amusements that is now owed to Thomas. With the company losing money this past quarter and Thomas reportedly being only a passive investor (with no plans of sitting on Midway's board of directors or engaging in management decisions), the LA Times could very well be right that Thomas may be looking to divide and sell the company and hope to make a profit by the end of the day. However, this is only speculation; Mark Thomas has only released scant information on his plans through the attorney arranging the purchase, and is not granting interviews.

We'll keep an eye on this story. As we learn more, we'll report it here.

To read the Wall Street Journal's announcement of the sale, click here. To read the LA Times analysis of the purchase, click here.

 
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