The Los Angeles Times is reporting that Atari Inc., and three of its affiliates, filed petitions for Chapter 11 reorganization in U.S. Bankruptcy Court in New York late Sunday in an attempt to break free from their debt-laden French parent company, Atari S.A.
Known throughout the world for its pioneering role in the video game market, Atari has struggled with financial problems for decades. Since the early 2000s, the company has been closely tied to Infogrames, which changed its name to Atari S.A. in 2003. In 2008, Atari S.A. acquired all the gaming pioneer’s American assets.
Chief Executive Jim Wilson has been with Atari Inc. since 2008, and in 2010 became CEO of Atari S.A. The New York-based executive has attempted to rebuild the company – which has just 40 employees in the U.S. – by moving well-known properties into the mobile and the Web-based markets, including a successful “greatest hits” compilation of arcade titles and an updated version of Pong. Wilson’s licensing of the Atari logo for consumer products nets the company 17 percent of its revenue.
According to the Times’ source – “a knowledgeable person not authorized to discuss the matter privately” – Atari’s leaders hope to find a buyer within the next few months and take the company private, as there are signs the U.S. operation had been improving. Save for the damage done by unsuccessful French subsidiary Eden Games, Atari, Inc. has seen a profit for the last two fiscal years, while Atari S.A. or Infogrames had been profitable for about a decade until that point.