Interplay death watch begins...

[Derek Smart [3000AD]]

Saw this posted by Rob over at GG forums (http://216.127.78.116/ubb/ultimatebb.cgi?ubb=get_topic;f=1;t=004872;p=2)


TITUS INTERACTIVE seeks to sell its American subsidiary company Interplay (AOF) - After having sold last April its studio Shiny Entertainment in Infogrames for 47 million dollars, the editor of video games Titus, who must face significant financial difficulties, seeks to sell its Interplay subsidiary company. "Our priority is to sell Interplay under good conditions" declared the president of Titus according to "Echoes'", this morning. Yesterday, the assembly of the Convertible debenture holders 2.5% approved the whole of the resolutions suggested in the majority, whereas that of the carriers of OCEANE 2% did not approve the resolutions presented. OCEANEs represent the majority of the debt of the group. This last will have to face the payment of a coupon of 1,4 million euros, 1 next July. Last 5 December, Titus had announced that it was going to ask the suspension of the payment of the coupons of its OCEANEs and its convertible obligations 2005 during three years, until the expiry of the titles which will be pushed back three years also. In its official statement, the group had then specified that "the Group Titus Interactive (connaisssait) a tended cash flow statement which should not enable him to on ensure the entirety of the payment of the annual coupon of the Convertible Obligations 2,5% January 1, 2003". The American subsidiary company of Titus Interactive, Interplay, had announced with the title of the third quarter a clear loss of 1,8 million dollars, against a clear loss of 20,6 M$ in the third quarter 2001. The sales turnover over the period had progressed from 153% to 9,7 M$. Titus Interactive holds 72,4% of Interplay

[Jakub]

I thought they were sold already.

I was talking with a Vivendi Universal rep and they work with Sierra, Blizzard and Interplay.

[Linoleum]

No, what happened with Vivendi-Universal is they signed a distribution deal and then axed those parts of Interplay. Interplay did this, rather, before Titus took over total control. The infighting was legendary from what I recall.

Titus had numerous opportunities to sell Interplay over the past couple years, they always wanted too much. Now there is basically nothing left of Interplay and it is worthless and they are trying to sell it to save Titus itself. Boo hoo.

[Qenan]

No, what happened with Vivendi-Universal is they signed a distribution deal and then axed those parts of Interplay. Interplay did this, rather, before Titus took over total control. The infighting was legendary from what I recall.

Titus had numerous opportunities to sell Interplay over the past couple years, they always wanted too much. Now there is basically nothing left of Interplay and it is worthless and they are trying to sell it to save Titus itself. Boo hoo.

Black Isle Studios is worthless? They've sure made some great games...

[Dave Long]

Interplay's worth is mostly in their hit games throughout their history. If a company wanted a built in fan base to start from, they'd be worth buying. I think the problem is that selling Interplay to someone big results in next to no gain for that company while smaller companies that could benefit, can't afford Titus' ridiculous prices for the company's assets.

--Dave

[Derek Smart [3000AD]]

Sadly, Interplay as it stands, is worthless. Apart from some IPs, anyone buying it would be buying a shell of its former self and the true worth might only be the IPs that it holds.

[olaf]

Its really sad to see shit like this. Interplay has made some awesome games over the years, going back to my C64 days when they were published through EA.

olaf

[Jessica]

No, what happened with Vivendi-Universal is they signed a distribution deal and then axed those parts of Interplay. Interplay did this, rather, before Titus took over total control. The infighting was legendary from what I recall.

Titus had numerous opportunities to sell Interplay over the past couple years, they always wanted too much. Now there is basically nothing left of Interplay and it is worthless and they are trying to sell it to save Titus itself. Boo hoo.

Black Isle Studios is worthless? They've sure made some great games...

As I understand it, most of Black Isle's games were developed out of house. Very few were developed inhouse.

[Rob_Merritt]

Basically Interplay is a single studio that has bleed talent for years, some minor IP (hey we love Fallout but no one else does), a license to make AD&D games till 2005 and a huge pile of debt. (38 million in debt). Unless someone has a massive desire to make an AD&D game without going through Infogrames, I don't see who would pay much for them. Titus is going to force to fire sale anything they can soon. If there was some part of Interplays IP, might be best to wait till then.

The only wild card is if Brain Fargo gets a backer or two and decides to go after interplay to regain it.

In any case, there doesn't seem to be a situation that the current studio and interneral development projects will continue.

[Desslock]

Black Isle Studios is worthless? They've sure made some great games...

As I understand it, most of Black Isle's games were developed out of house. Very few were developed inhouse.

Fallout 1&2, Icewind Dale 1&2, Planescape Torment well all developed internally by Black Isle (although some of the members of those teams have since left Interplay). In fact, the -only- significant Black Isle games not developed in-house were the Baldur's Gate games.

The problem is, the value of those franchises is probably far less than Titus would expect to receive from a purchaser, since Titus bought overpriced Interplay stock. Other great franchises have been allowed to die a miserable death (Ultima, Wing Commander, potentially Sirtech's), it'd be a shame if Interplay's joined the pyre. It'd be even worse if their talented development teams were allowed to disperse.

[Jim F.]

Problem with all those Black Isle titles is that, while they are some of the best games ever made in the RPG genre, they didn't do well at all by today's standards. (or was Toment a big seller? I know ID 1/2 and Fallout 1/2 were both financial disappointments)

Hard to sell a companies IP rights when those IP rights appeal to a small niche market. It's like trying to take a club band on a world tour.

[Qenan]

Is the problem that Fallout and Torment didn't make profits, or just that the profits were not huge? (If you really can't make a profit on a game like that, why bother with RPGs at all?)

[Robert Sharp]

I thought the original IWD did pretty well, especially considering it was released opposite Diablo 2, which was stupid. I remember reading reports that the sales were higher than expected.

I have no idea why any of those games didn't sell well though, since that is a list of some of the best RPGs in history.

[Desslock]

Problem with all those Black Isle titles is that, while they are some of the best games ever made in the RPG genre, they didn't do well at all by today's standards. (or was Toment a big seller? I know ID 1/2 and Fallout 1/2 were both financial disappointments).

Torment sold the worst of those games. Both Fallout games sold reasonably well (other than the BG games, they outsold most other Interplay games). Icewind Dale 1 exceeded sales expectations, but I don't think IWD2's sales were very good.

[Brian Koontz]

There are a lot of knocks against Planescape:Torment, namely that it is "too weird" and there is "too much dialogue". It appeals mostly to a modern type of hardcore RPGer.

[Jessica]

Fallout 1&2, Icewind Dale 1&2, Planescape Torment well all developed internally by Black Isle (although some of the members of those teams have since left Interplay). In fact, the -only- significant Black Isle games not developed in-house were the Baldur's Gate games.

The problem is, the value of those franchises is probably far less than Titus would expect to receive from a purchaser, since Titus bought overpriced Interplay stock. Other great franchises have been allowed to die a miserable death (Ultima, Wing Commander, potentially Sirtech's), it'd be a shame if Interplay's joined the pyre. It'd be even worse if their talented development teams were allowed to disperse.

Ah, thanks for the info, Dess.

I know some of the BI division members have left, though I don't know if it has been a mass run for the door yet. I was surprised to see that Chris Taylor had left for Vivendi; along with Rusty Buchert and a couple others, he was one of the better people at Interplay, in my opinion. And he has a wicked sense of humor, :D.

[Derek Smart [3000AD]]

along with Rusty Buchert and a couple others, he was one of the better people at Interplay, in my opinion. And he has a wicked sense of humor, :D.

Indeed!

[Qenan]

There are a lot of knocks against Planescape:Torment, namely that it is "too weird" and there is "too much dialogue". It appeals mostly to a modern type of hardcore RPGer.

The dialog is what makes it a great game. The fighting in these games gets pretty dull after a while.

[Peter Olafson]

Beyond Black Isle, the company still has a fair number of valuable brands (like Baldur's Gate) or potentially valuable ones (like Descent) that will draw instant recognition to any product to which they're attached. That's got to be worth something.

Peter

[Desslock]

I was surprised to see that Chris Taylor had left for Vivendi.

I didn't know about that departure -- that is a big loss. Chris is great.

[Jakub]

Beyond Black Isle, the company still has a fair number of valuable brands (like Baldur's Gate) or potentially valuable ones (like Descent) that will draw instant recognition to any product to which they're attached. That's got to be worth something.

Peter

Interplay also holds the FreeSpace license.

[DaveC]

Beyond Black Isle, the company still has a fair number of valuable brands (like Baldur's Gate) or potentially valuable ones (like Descent) that will draw instant recognition to any product to which they're attached. That's got to be worth something.

Peter

Interplay also holds the FreeSpace license.

Are you sure the dev doesn't hold that?

[Bub, Andrew]

As I understand it from the last time I interviewed the folks at Volition (this was 2 years ago), Volition owns the name "Freespace" but not the name "Descent: Freespace."

[Desslock]

As I understand it from the last time I interviewed the folks at Volition (this was 2 years ago), Volition owns the name "Freespace" but not the name "Descent: Freespace."

Interplay owns the name Freespace, unless Volition bought it from Interplay some time after the release of FS2.

In any event, given the limited commercial success of FS2, it's probably not considered particularly valuable IP. Ditto Descent, after Descent 4's performance.

[Peter Olafson]

As I understand it from the last time I interviewed the folks at Volition (this was 2 years ago), Volition owns the name "Freespace" but not the name "Descent: Freespace."

Interplay owns the name Freespace, unless Volition bought it from Interplay some time after the release of FS2.

In any event, given the limited commercial success of FS2, it's probably not considered particularly valuable IP. Ditto Descent, after Descent 4's performance.

That would be Descent 3, yes? Descent 4 turned into Red Faction.

I thiought Descent 3 did OK. They released an add-on (Mercenary) for it, after all. Isn't that usually an indicator of a game's popularity?

Peter

[Desslock]

As I understand it from the last time I interviewed the folks at Volition (this was 2 years ago), Volition owns the name "Freespace" but not the name "Descent: Freespace."

Interplay owns the name Freespace, unless Volition bought it from Interplay some time after the release of FS2.

In any event, given the limited commercial success of FS2, it's probably not considered particularly valuable IP. Ditto Descent, after Descent 4's performance.

That would be Descent 3, yes? Descent 4 turned into Red Faction.

I thiought Descent 3 did OK. They released an add-on (Mercenary) for it, after all. Isn't that usually an indicator of a game's popularity?

heh, good catch -- yes, number 3. It did do ok, but nothing close to the numbers of the first two, which were real blockbusters. If you were valuing the Descent name in 1996-7, you'd be able to justify a very high valuation based upon D2's performance. At that point it might have been considered one of the most valuable brands in gaming -- that clearly isn't the case any more.

Interplay has some brands that found decent audiences, and a short-term D&D license, and some good, experienced, employees. Collectively those assets definitely have some value, although probably not as much as Interplay's market cap, let alone what it was at its peak (even taking into account the Shiny sale) when Titus bought a good chunk of its shares.

Bah, this is depressing!

[Anonymous]

To confirm, Interplay is the owner of the Freespace title

[Rob_Merritt]

So now we have a price

Paris, Jan. 3 (Bloomberg) -- Titus Interactive SA shares surged for a second day after the French video-game maker's bondholders approved a plan to push back debt payments, averting default for the company.

Shares in the maker of games such as ``Baldur's Gate'' rose 7 cents, or 7.3 percent, to 1.03 euros on the Paris stock exchange after gaining 68 percent yesterday. The stock lost 84 percent in 2002.

``The company's still not in good shape,'' Titus President Eric Caen told Bloomberg Television. ``We've avoided bankruptcy. Now, we have a few months to study our options, including selling some assets.''

Titus, which has 92 million euros ($96 million) of debt, is considering selling its U.S. business, Interplay, Caen said. He valued the business at as much as 100 million euros. The company's bondholders on Dec. 30 agreed to push back convertible bond payments due in 2005 to 2008. Titus had a debt payment on Jan. 1 that it wasn't able to make, Caen said.


So Titus wants to sell interplay for 100 million euros. (according to todays chart, 100 million euros = 96 million dollars)
Got a feeling chances of that happening is small. Anyways now that we now Titus is missing debt payments, they may not be around for long either it seems.

[Jessica]

So now we have a price

Paris, Jan. 3 (Bloomberg) -- Titus Interactive SA shares surged for a second day after the French video-game maker's bondholders approved a plan to push back debt payments, averting default for the company.

Shares in the maker of games such as ``Baldur's Gate'' rose 7 cents, or 7.3 percent, to 1.03 euros on the Paris stock exchange after gaining 68 percent yesterday. The stock lost 84 percent in 2002.

``The company's still not in good shape,'' Titus President Eric Caen told Bloomberg Television. ``We've avoided bankruptcy. Now, we have a few months to study our options, including selling some assets.''

Titus, which has 92 million euros ($96 million) of debt, is considering selling its U.S. business, Interplay, Caen said. He valued the business at as much as 100 million euros. The company's bondholders on Dec. 30 agreed to push back convertible bond payments due in 2005 to 2008. Titus had a debt payment on Jan. 1 that it wasn't able to make, Caen said.


So Titus wants to sell interplay for 100 million euros. (according to todays chart, 100 million euros = 96 million dollars)
Got a feeling chances of that happening is small. Anyways now that we now Titus is missing debt payments, they may not be around for long either it seems.

Yeah, I can't see how the company is worth $100 million today. There isn't much there of value anymore. The AD&D license is one of the few money-makers, but that license expires in a couple years, I believe, and Infogrames is going to want hard cash to renew it. If they want to renew to an outside company at all.

[Linoleum]

Last I knew Rusty was still at Interplay. Chris Taylor was long gone (as far as I know he is still overseeing design/production of Universal's LoTR games).

[Anonymous]

Different person then the Chris Taylor behind GasPowered Games I assume?

[DaveC]

Different person then the Chris Taylor behind GasPowered Games I assume?

No, Chris Taylor from GPG use to work at Interplay.

[Desslock]

Different person then the Chris Taylor behind GasPowered Games I assume?

No, Chris Taylor from GPG use to work at Interplay.

No, it is a different person being referenced.

[Rob_Merritt]

Lovely news, it appears Titus sold 3+ million shares of Interplay stock yesterday to make payroll.

[Derek Smart [3000AD]]

Lovely news, it appears Titus sold 3+ million shares of Interplay stock yesterday to make payroll.

whoa!! where'd you read that? :shock:

[Rob_Merritt]

]Lovely news, it appears Titus sold 3+ million shares of Interplay stock yesterday to make payroll.

whoa!! where'd you read that? :shock:

It was on the yahoo IPLY investment board. However the post got yanked just a bit ago. Here is the most relevent post still up.

http://messages.yahoo.com/bbs?.mm=FN&action=m&board=11545159&tid=iply&sid=11545159&mid=17287

The original message explan how the owners of Titus (and interplay as well) had to get some cash to make critical payrolls. It included a bit about how people haven't been paid in awhile as well.. Keep in mind, 3 million at 6 cents is only $180,000. for a company as large at Titus/interplay is, I can't imagine thats more than a week or two.

[xahlt]

And I can't imagine the stock staying at 6 cents as they proceed to dump 3 mil of it to make payroll.

[SpoofyChop]

And I can't imagine the stock staying at 6 cents as they proceed to dump 3 mil of it to make payroll.

Perhaps they lined up some buyers before making the sale rather than doing it on the open market.

[Derek Smart [3000AD]]

And I can't imagine the stock staying at 6 cents as they proceed to dump 3 mil of it to make payroll.

Perhaps they lined up some buyers before making the sale rather than doing it on the open market.

That is a strong possibility.

btw, read this thread (http://forums.interplay.com/viewtopic.php?t=6919&start=0)

[olaf]

Well if Titus really is that bad off financially, no one is going to cough up the kind of money they are asking for IP, because that same interested party could just wait until Titus declares bankruptcy and then get IP for a song.

olaf

[Rob_Merritt]

And the story now is...

Brian Fargo sold his last shares of Interplay.

"I was actually on the phone with CEO Herve Caen, who is in France, when we learned of the large sale yesterday. Neither of us is aware of who was selling, though it logically could be concluded that it must have been a special situations fund that holds a large number of shares or Mr. Fargo, who still might hold some of his original 4 million shares. You can, however, be assured that it wasn't Mr. Caen selling."

not that anything is true.

[Derek Smart [3000AD]]

Nevertheless, who can blame him? I mean, even if IPLY is bought, thats not going to help its stock nor net worth in any shape or form. At least not in the short team, if even.

Even though some analysts price IP at $100m (which is rubbish, really), there is no way in hell Titus is going to get that for IPLY. In fact, isn't IPLY in more debt that its actually worth? If thats the case, then a fire sale is imminent...unless of course Titus can pull the proverbial rabbit. They should start by selling off Virgin Interactive. :D

You can actually get a good sizeable studio worth something by buying IPLY, getting rid of the excess fat and sticking with the Black Isle guys. i.e. consolidate everything into that one studio. Give those guys some control, two products to work on in tandem and put someone e.g. Fergy (someone with a spine - like me for instance :D) worthy of the responsibility, in charge, and tell them to make games.

[Desslock]

[quote="Derek Smart [3000AD]"]

Thanks for the history link, Derek. Wow, Pacific Century almost bought them? I know those guys pretty well, and it certainly doesn't fit with their business, so I'm not surprised they passed.

[Linoleum]

Actually, I think they probably would have been able to sell, but Titus was rather arrogant about the price and did negotiation French style rather than Asian style. Morons.

[Rob_Merritt]

]Even though some analysts price IP at $100m (which is rubbish, really), there is no way in hell Titus is going to get that for IPLY. In fact, isn't IPLY in more debt that its actually worth? If thats the case, then a fire sale is imminent...unless of course Titus can pull the proverbial rabbit. They should start by selling off Virgin Interactive. :D

Interplays debt is 32 million to 38 million depending on how you count it. Titus own debt is 92 milion. So both are over 100 million.

[Sean Tudor]

Can anyone explain to me what the relationship is between Bioware, Black Isle, and Interplay ?

Isn't Bioware and Black Isle two parts of the same company ?

[graller]

Bioware is an independent dev house based in Canada. Interplay thru there Black Isle Studio division - dedicated to RPG's - contracted them to create the first BG and the Infinity Engine. Bioware used Interplay as a publisher for BG, BG 1 Exp, BG 2 and BG 2 Exp and NWN originally. After they got in trouble with the AD&D license they sold the right to publish NWN to Infogrammes. Black Isle went on to create their own Infinity based games internally also published by Interplay - PT, IWD,IWD-HOW, IWD2. Black Isle is still owned by Interplay and Titus and the only thing they hold of any value.

[Sean Tudor]

Bioware is an independent dev house based in Canada. Interplay thru there Black Isle Studio division - dedicated to RPG's - contracted them to create the first BG and the Infinity Engine. Bioware used Interplay as a publisher for BG, BG 1 Exp, BG 2 and BG 2 Exp and NWN originally. After they got in trouble with the AD&D license they sold the right to publish NWN to Infogrammes. Black Isle went on to create their own Infinity based games internally also published by Interplay - PT, IWD,IWD-HOW, IWD2. Black Isle is still owned by Interplay and Titus and the only thing they hold of any value.

Thanks - that clears up a lot. So in the early days I assume there was some shared development between Black Isle programmers and Bioware programmers ? I am surprised Bioware didn't make an attempt to acquire the Black Isle staff.

[DaveC]

Bioware is an independent dev house based in Canada. Interplay thru there Black Isle Studio division - dedicated to RPG's - contracted them to create the first BG and the Infinity Engine. Bioware used Interplay as a publisher for BG, BG 1 Exp, BG 2 and BG 2 Exp and NWN originally. After they got in trouble with the AD&D license they sold the right to publish NWN to Infogrammes. Black Isle went on to create their own Infinity based games internally also published by Interplay - PT, IWD,IWD-HOW, IWD2. Black Isle is still owned by Interplay and Titus and the only thing they hold of any value.

Small correction, Interplay only had the rights for some of the D&D universe. Hasbro Interactive through WotC had the rest. When Infogrames bought Hasbro Interactive they got the rights to computer D&D. This doesn't affect any of the pen and paper stuff, just the computer end of things.

[Jessica]

Bioware is an independent dev house based in Canada. Interplay thru there Black Isle Studio division - dedicated to RPG's - contracted them to create the first BG and the Infinity Engine. Bioware used Interplay as a publisher for BG, BG 1 Exp, BG 2 and BG 2 Exp and NWN originally. After they got in trouble with the AD&D license they sold the right to publish NWN to Infogrammes. Black Isle went on to create their own Infinity based games internally also published by Interplay - PT, IWD,IWD-HOW, IWD2. Black Isle is still owned by Interplay and Titus and the only thing they hold of any value.

Small correction, Interplay only had the rights for some of the D&D universe. Hasbro Interactive through WotC had the rest. When Infogrames bought Hasbro Interactive they got the rights to computer D&D. This doesn't affect any of the pen and paper stuff, just the computer end of things.

If memory serves, in 1994 when I was at Interplay and we were negotiating with TSR, we licensed Forbidden Realms and Planescape only. Dragonlance, Greyhawk, etc., weren't part of the deal.

I dont recall hearing that the company ever picked up other universes to play in.

[Derek Smart [3000AD]]

Here is the link to the post (http://forums.interplay.com/viewtopic.php?p=118454#118454) from Feargus that I was looking for and which someone posted on GG.

[Kalle]

What I want to know is: Will Black Isle survive all this?

Black Isle is by now the only dev. house left whose products I will buy without bothering to wait for the reviews.

Finding such a gem is rare.

[graller]

I agree with you on this Kalle and can only hope they manage to walk away from the train wreck like Supertanker did.

[Rob_Merritt]

What I want to know is: Will Black Isle survive all this?


Don't know. Everyone wants them to continue. They are working like they are going to continue. However from a business point of view, it doesn't look likely. Titus is asking 100 million for it. Investors say Interplay is worth in the 20-30 million range. It would be cheaper for a company to attempt to hire away what talent exist at Black Isle then buy Interplay IP in a fire sale a few months later. More than likely, everyone will be layed off in a few months.

[Qenan]

What I want to know is: Will Black Isle survive all this?

Black Isle is by now the only dev. house left whose products I will buy without bothering to wait for the reviews.

Finding such a gem is rare.

Yes. Exactly.

[Miramon]

Well, hell, if Interplay goes under as it should have done over a year ago anyway, Black Isle can just reconstitute itself from scratch again. They can either buy their current engine back from the IP owner for cheap, or just build another one from scratch. Either way they are sure to find a publisher if they just don't break up and go their separate ways.

[Derek Smart [3000AD]]

Either way they are sure to find a publisher if they just don't break up and go their separate ways.

As a team, I don't see that happening. Ever.

In an industry where it costs between $2m-$3m and almost 2 years to do a triple-A title, they're going to be hard pressed to find a publisher willing to take them on at the same time. Thats the same thing happening to the SirTech Canada team right now.

Worse case scenario : They all get laid off and IPLY goes through a fire sale

Best case scenario : IPLY goes through a fire sale and some BIS members stay on. I doubt very seriously that BIS will surive even an IPLY buyout, let alone a firesale

Sad, really

[Mark Asher]

Maybe Black Isle can work out something with Infogrames, who own the 3E D&D license for the next 13-14 years? If not, and IPLY goes under, I'd expect some of them to resurface elsewhere at least.

[Desslock]

If memory serves, in 1994 when I was at Interplay and we were negotiating with TSR, we licensed Forbidden Realms and Planescape only. Dragonlance, Greyhawk, etc., weren't part of the deal.

I dont recall hearing that the company ever picked up other universes to play in.

That's correct -- the other licenses are vacant. Interplay had an exclusive license on FR initially as well, but that eventually became a non-exclusive grant (initially in connection with Stormfront's Pool of Radiance: ROMD)

[Desslock]

Titus is asking 100 million for it. Investors say Interplay is worth in the 20-30 million range.

Actually investors value it at exactly $5,800,000, since that's its value on NASDAQ. $100 million is preposterous.

[Anonymous]

If they go through bankruptcy and canbalize their assests who would buy it? In particular the rights to the creative properties such as Descent, Freespace, The Fallout series?

[Anonymous]

If they go through bankruptcy and canbalize their assests who would buy it? In particular the rights to the creative properties such as Descent, Freespace, The Fallout series?

Well, giving Volition access to the Freespace universe again would be nice. After the poor sales of Freespace 2 I can't see a publisher letting them make Freespace 3, but you could always hope. I think they're with THQ now so that could be a buyer.

[Enkidu]

Actually investors value it at exactly $5,800,000, since that's its value on NASDAQ. $100 million is preposterous.

That's the value of the equity alone. You should also take into consideration that someone would need to assume or pay off their debt, so the cost is arguably much higher than just under $6 million. It's not $100 million even so.

[Desslock]

Actually investors value it at exactly $5,800,000, since that's its value on NASDAQ. $100 million is preposterous.

That's the value of the equity alone. You should also take into consideration that someone would need to assume or pay off their debt, so the cost is arguably much higher than just under $6 million. It's not $100 million even so.

$5,800,000 is the fair market value of the company -- you can buy the entire company for that amount.

In the event the assets of the company are insufficient to pay off, or continue to service, the debt of the company, you'll lose your $5,800k investment because the company will lose its assets and the shares will have no value, but you'll never be obligated to pay more than $5,800k.

You'd presumably have to be willing to throw some additional cash to allow the company to service its debt (which it clearly is unable to do based upon revenues currently), but that amount would be much less than the actual amount of the debt.

[Anonymous]

DaveB at Volition has said they always wanted to make at least one more Freespace. When they split from Interplay there was an attempt to get the rights. I don't know how serious the effort was though.

[Mark Asher]

DaveB at Volition has said they always wanted to make at least one more Freespace. When they split from Interplay there was an attempt to get the rights. I don't know how serious the effort was though.

Volition isn't an independant developer anymore. They're owned by some publisher now. THQ? Anyway, they may not be able to pick and choose what they work on. Presumably the publisher has to greenlight any projects, and if Freespace didn't sell well, there may be little chance of a new version.

[Anonymous]

Your right, their THQ's.

[Jason McCullough]

Actually investors value it at exactly $5,800,000, since that's its value on NASDAQ. $100 million is preposterous.

That's the value of the equity alone. You should also take into consideration that someone would need to assume or pay off their debt, so the cost is arguably much higher than just under $6 million. It's not $100 million even so.

The market is factoring in taking on that debt servicing into the price, too. If they didn't have any debt, it'd cost more than 6 million to buy them.

[Enkidu]

$5,800,000 is the fair market value of the company -- you can buy the entire company for that amount.

In the event the assets of the company are insufficient to pay off, or continue to service, the debt of the company, you'll lose your $5,800k investment because the company will lose its assets and the shares will have no value, but you'll never be obligated to pay more than $5,800k.

You'd presumably have to be willing to throw some additional cash to allow the company to service its debt (which it clearly is unable to do based upon revenues currently), but that amount would be much less than the actual amount of the debt.

The market is factoring in taking on that debt servicing into the price, too. If they didn't have any debt, it'd cost more than 6 million to buy them.

I fully understand both of these points, and we are pretty much in agreement. However, given that most of the folks on this board are neither accounting nor legal professionals (with a few notable exceptions), I wanted to point out that the company has a substantial debt burden that doesn't go away just because someone has purchased the company's stock. You both know this, as do many other folks here, but not everyone is fully versed in these matters. On a risk adjusted return basis, a high price with no debt and a low price with substantial debt are essentially equivalent.

As you also know, it may not make sense to say the company is worth $6 million just because that is the current market capitalization. Interplay is hardly a liquid stock in an efficient market, so the market clearing price could be substantially higher (or lower) than that $6 million.

[Edit add:] Along those lines, given that Titus controls a majority of shares, there isn't a fair market value established by individual shareholders participating in the market. The price really is whatever price Titus as seller can find a buyer.

[Jack]

It appears Black Isle is hiring, so hopefully they won't go down with the Interplay ship (source, rpgdot.com):

3D ARTIST

Black Isle Studios, a leading developer and publisher of console and PC role-playing game products is looking for talented 3D artists, particularly with experience creating models and texture maps for natural and architectural environments.

Black Isle offers a fun, creative, and challenging environment with competitive base salaries and benefits. And yes, great weather.

[Joe O'Malley]

$5,800,000 is the fair market value of the company -- you can buy the entire company for that amount.

You can buy it for a lot less than that. It doesn't require 100% ownership to control a public company, just a majority. Depending on how spread out the stock ownership currently is you might be able to have -practical- control of Interplay for anywhere between 30-51% of the stock.

Granted you would only control the company, not really own it, so the cash infusion they need would still be problematic.

Another thing is that the shareholders of Interplay, fearing the worst if a buyer doesn't come through soon, might settle for a tender offer much lower than the theoretical $5,800,000 their shares are worth. The shares may list for that price, but if no one is buying them, the value is just theoretical, ya?

[Jakub]

It appears Black Isle is hiring, so hopefully they won't go down with the Interplay ship (source, rpgdot.com):

Some companies will be hiring until the last day they're around.

[Mark Asher]

I doubt you could buy Interplay through stock purchase without going through Titus, which I believe controls a majority share. The sale price of Interplay depends on what Titus is willing to accept, not the stock market value of the company.

I wonder just what Interplay is worth? They have access to the Forgotten Realms license, which has value, but what else do they have? I guess Fallout is worth something. Do they really have a lot of IP that's worth much, though?

[Reeko]

I guess you'd have to consider consumer sentiment. For me, seeing Black Isle Studios on the box means quality RPG's, separate from where they are set or what rules are being used. That reputation has some value.

[Mark Asher]

I guess you'd have to consider consumer sentiment. For me, seeing Black Isle Studios on the box means quality RPG's, separate from where they are set or what rules are being used. That reputation has some value.

Sure, but how much monetary value does BIS bring? Did IWD2 sell well? The big Interplay RPGs have come from BioWare. Most people love Planescape, but it didn't come close to doing Baldur's Gate numbers.

You really need to own IP to boost your value. That's why BioWare is developing their own IP. If they own the IP for a new game that's a hit, the value of the company will rise. I'm sure Greg and Ray want to sell BioWare at some point to someone like a Microsoft or an EA. They'll get a lot more if they have valuable IP included in the package. What would you get if you bought BioWare now? A lot of talented developers who might leave over the next few years, but no IP. You need the Forgotten Realms license to do more Baldur's stuff (I'm guessing, but who knows how the contract is set up). You need the Star Wars license to do more Star Wars stuff. What does BioWare own besides that mech game they did that wasn't a hit?

[Anonymous]

How many units did the Fallout series sell?

[Mark Asher]

How many units did the Fallout series sell?

It's not the number of units but how much revenue did it generate. You can buy Fallout 1 and 2 now bundled together for $10, and it's been that way for some time. Maybe Fallout 2 has sold 300,000 copies, for example, but maybe as many as 200,000 copies were steeply discounted.

From everything I've heard the Fallout series did not sell in big numbers.

[Jason McCullough]

As you also know, it may not make sense to say the company is worth $6 million just because that is the current market capitalization. Interplay is hardly a liquid stock in an efficient market, so the market clearing price could be substantially higher (or lower) than that $6 million.

[Edit add:] Along those lines, given that Titus controls a majority of shares, there isn't a fair market value established by individual shareholders participating in the market. The price really is whatever price Titus as seller can find a buyer.

Good points. You damned space robot.

[xahlt]

That's true about the Fallout numbers, and I don't think the license has a lot of clout among the casual gamer. I don't remember Fallout Tactics numbers, but I doubt they were great.

However, it has been said as an argument for a the possibility of a strong sale of say, Fallout 3 - that Fallout 1 and 2 were released on the cusp of the RPG renaissance (why they may not have sold big); and in counterpoint to the setting argument, that although gamers always return to D&D as a comfort zone (why FO didn't do BG numbers), most of the stranger settings have been done imperfectly (Torment appealed to a small crowd, Arcanum was buggy/unwieldy combat/etc) and IWD 1/2 didn't do great numbers despite its setting.

Which is all just a roundabout way of saying, IMO, that a very well done Fallout 3 could sell real numbers, up there with the BG2s. Not blockbuster numbers, but large, successful numbers.

Not that they're splitting up these licenses for sale anyway

[Enkidu]

Good points. You damned space robot.

Please. I prefer souless corporate drone. My wife is a space robot.

[Rob_Merritt]

Latest update from yahoo france:
http://fr.biz.yahoo.com/030218/18/3214e.html

Over all it will not be long now. Titus is pumping Interplay 1.5 million a month (in euros whatever that works out in real money) to stay alive. Titus has notes coming due in july. If they are left unpaid, Titus, and Interplay will shut down at that point. The minimum payment is 20 million.

However, Titus has started drawing a lot of interest in Interplay now they have dropped the price to 60 million US. And Derek Smart take note, the rumor mills of the Yahoo investment boards are pointing towards Take Two. Another point to note is Galleon appears to have been quitely killed or at least development haulted as pretty much the entire Galleon development team is currently working on a new Hunter game.

[Derek Smart [3000AD]]

And Derek Smart take note, the rumor mills of the Yahoo investment boards are pointing towards Take Two.

Yeah, I've been hearing that for some time now, but the fact is, Take2 is a run-and-gun kind of company. I have no idea what they could possibly gain from buying Interplay. If they do, it will probably end up being one of those mistakes where you see one company buying another - then finding out several years down the road just how bad an idea that was.

Buying a developer is one thing. Thats what Take2 does. Buying an entire company - and one with major debts, internal turmoil and seemingly no direction whatsoever, is clearly another matter.

Now, if it was a case of Take2 buying both Interplay and Titus, now thats another story. Though I can't see that happening.

Besides, Take2 doesn't have $60m to blow. Take a look at their financials. Its not as liquid as one would think when going on a $60m buying spree. And even a stock purchase will have an impact with numbers of that magnitude.

[Matthew Gallant]

They already blew their mad money on Barking Dog and the :roll: Max Payne IP.

[Rob_Merritt]

In a rather odd move, interplay fired its accountants.

http://biz.yahoo.com/e/030225/iply.ob8-k.html


Why? Because "E&Y `s opinion contained a qualification as to the Company's ability to continue as a going concern. "

[Robert Sharp]

I wonder just what Interplay is worth? They have access to the Forgotten Realms license, which has value, but what else do they have? I guess Fallout is worth something. Do they really have a lot of IP that's worth much, though?

But does the Forgotten Realms license really have any value? And what is that value, exactly? How many people who haven't played D&D even know what FR is? And I would be there are many people who HAVE played D&D that don't give a crap about Forgotten Realms. If you put D&D on the game, that's enough for most people. I generally don't even keep up with such things, despite knowing the difference, so I am betting the majority of gamers aren't either. A few Salvatore fans might be interested in such games, I guess.

It sounds to me like Titus is just out of luck...they need to dump it how they can when they can.

[Mark Asher]

Yeah, I think getting to do a Forgotten Realms D&D game has some cachet. Pool of Radiance sold over 100,000 copies (probably double that for global sales) despite all its problems.

Obviously, you want to attach a good game to the license, but the license in this case really does help. What's it worth if it transfers and the Baldur's brand transfers as well (speculation here)? Quite a bit, I'd say. The PS2 Baldur's game is in their greatest hits series, so it sold well, and of course the PC games sold quite well too.

[xahlt]

Well, and aside from the fact the only alternative D&D world that fits normal fantasy conventions is Greyhawk which is only just now getting a game and may have significance for PnP players but virtually nothing in terms of games. If ToEE sells well that might change, but I believe the main thrust has always been that FR has high magic and high fantasy which translates to the kind of RPG people expect. Plus, Dark Sun and Planescape have been fairly well abandoned, Dragonlance hasn't seen games since Gold Box, and the fact they haven't sold FR numbers in games doesn't look great for them being used.

Like Mark says, Baldur's Gate is probably the biggest draw.

[Tyjenks]

Yeah, I think getting to do a Forgotten Realms D&D game has some cachet. Pool of Radiance sold over 100,000 copies (probably double that for global sales) despite all its problems.

Wow. Imagine if it had actually been good. That one still makes me sad.

On a semi-related note, I can...not....wait to see the MoO3 numbers. I wish NPD or whoever tracks such things also tracked returns. I must admit that part of that eagerness is so I can start a new MoO3 thread to put up the sales figures and further anger wumpus.

[Brandon Clements]

On a semi-related note, I can...not....wait to see the MoO3 numbers. I wish NPD or whoever tracks such things also tracked returns. I must admit that part of that eagerness is so I can start a new MoO3 thread to put up the sales figures and further anger wumpus.

Don't returns count against sell-through?

[Anonymous]

Yeah, I think getting to do a Forgotten Realms D&D game has some cachet. Pool of Radiance sold over 100,000 copies (probably double that for global sales) despite all its problems.

If you mean the Ubi Soft game, it sold well, but those sales numbers don't account for all the copies that were subsequently returned. I don't have any numbers in front of me, but I'll bet the number of returns was way up there. The numbers were also due, in part, to name recognition. As you've probably surmised by now, the Pool of Radiance name is now worthless.

If ToEE sells well that might change, but I believe the main thrust has always been that FR has high magic and high fantasy which translates to the kind of RPG people expect. Plus, Dark Sun and Planescape have been fairly well abandoned, Dragonlance hasn't seen games since Gold Box, and the fact they haven't sold FR numbers in games doesn't look great for them being used.

Like Mark says, Baldur's Gate is probably the biggest draw.

TOEE actually sell well?

Anyway, the Dark Sun and Planescape settings, along with Dragonlance and Ravenloft, have been officially discontinued by Wizards of the Coast. The only D&D games that stand any chance of making any kind of money are those that are relevant today, and the only settings that are relevant are Forgotten Realms and Chainmail, both with 3rd Edition rules.

Baldur's Gate is a draw for two reasons--one, it's Forgotten Realms, two, it's now its own developed intellectual property, and it already has a console game offshoot. Interplay has the Baldur's Gate license for, I think, a year or two longer, then that, and Dungeons & Dragons, slips from its grasp. BioWare owns the Baldur's Gate name, Infogrames currently holds legal rights for Dungeons & Dragons.

[xahlt]

Whoa, whoa, Bioware does not own the Baldur's Gate name. It doesn't revert to them at a future point. Interplay owns the name; that's separate from their a right to produce a limited number of grandfathered D&D games from the earlier license.

At least, that's the information publicly available.

And no, I wouldn't have high hopes for ToEE to sell high numbers but you never know.

[Mark Asher]

"If you mean the Ubi Soft game, it sold well, but those sales numbers don't account for all the copies that were subsequently returned. I don't have any numbers in front of me, but I'll bet the number of returns was way up there. The numbers were also due, in part, to name recognition. As you've probably surmised by now, the Pool of Radiance name is now worthless."

I don't know how returns are counted, but the NPD numbers I did see were many months after Pool was released. If NPD collects data on returns and factors that in, then the numbers I saw should have been accurate. Perhaps returns are never factored in, though.

I'd love to see an NPD Top Ten Returned Games list. That would be an asskicker of a list.

[DaveC]

Whoa, whoa, Bioware does not own the Baldur's Gate name. It doesn't revert to them at a future point. Interplay owns the name; that's separate from their a right to produce a limited number of grandfathered D&D games from the earlier license.

At least, that's the information publicly available.

And no, I wouldn't have high hopes for ToEE to sell high numbers but you never know.

I would think that WotC owns the name as it's a FR location and that Interplay currently has the rights for computer games based in that part of the FR.

[Desslock]

Whoa, whoa, Bioware does not own the Baldur's Gate name. It doesn't revert to them at a future point. Interplay owns the name; that's separate from their a right to produce a limited number of grandfathered D&D games from the earlier license.

At least, that's the information publicly available.

And no, I wouldn't have high hopes for ToEE to sell high numbers but you never know.

I would think that WotC owns the name as it's a FR location and that Interplay currently has the rights for computer games based in that part of the FR.

That is correct -- WotC owns all of the names -- Baldur's Gate (and even any associated names that are original, such as "Shadows of Amn", are viewed as derivative intellectual property, and therefore owned by WotC, not Interplay). Interplay just has a licence.

[xahlt]

Yeah, sorry, I didn't mean to imply they owned the IP or anything; I meant that Interplay owned the license to make another Baldur's Gate game if they wanted whereas Bioware doesn't.

[DaveC]

Yeah, sorry, I didn't mean to imply they owned the IP or anything; I meant that Interplay owned the license to make another Baldur's Gate game if they wanted whereas Bioware doesn't.

Sure we could, we'd just have to call it, "Timmy's Big Adventure in the Land of Dragons and Hot Elf Women in Chainmail Bikinis".

[xahlt]

If that's the new IP you guys are developing...

I like it.