In February, Midway filed for bankruptcy and then the company decided to use cash collateral to keep their company alive. Looks like the company will not need to hang by a financial string anymore because the Mortal Kombat company was bought by Warner Brothers for $33 million.

As part of the deal, Warner Brothers will get most of Midway’s assets.  And some of the legal disputes existing between creditors, senior executives, and major stakeholder Mark Thomas have been resolved.

Some of the companies that objected to the Warner Brothers sale include Hollywood production company Threshold Entertainment, which produced two Mortal Kombat movies.  Tigon Studios Inc., a company founded by Vin Diesel also objected to the sale.  Tigon and Midway both worked on a video game called Wheelman which starred Diesel.  All of the objections were resolved.

[via ChicagoTribune]

Despite what we were saying before, Midway Games Inc. (NYSE:MWY)  will actually be staying in business for a while now.  Although the Mortal Kombat company filed  for Chapter 11, the Bankruptcy Court for the District of Delaware has allowed them to use cash collateral to continue financial operations.  THis includes paying salaries and offering benefits to employees.  Midway was also authorized to use cash collateral to pay vendors and suppliers.

“Approval of these motions is an important first step in this planned and orderly reorganization, enabling Midway to continue to operate as usual during this process,” stated Matt Booty, Midway’s Chairman and CEO in the announcement. “We remain confident in Midway’s ability to use this proven process to address our capital structure and explore our strategic alternatives.”

Midway is based in Chicago, Illinois.  They made this announcement in a press release yesterday.

Midway Games Inc. (NYSE:MWY) is best known for the game Mortal Kombat, the franchise that encourage kids to rip heads off their opponents at the end of every battle when the narrarator yells “FINISH HIM.”  This franchise may actually be finished soon because they had to file for a Chapter 11.  Midway put out a press release today announcing that they have filed a voluntary petition in the U.S. Bankruptcy Court for the District of Delaware for reorganization under Chapter 11 of the U.S. Bankruptcy Code.

In December 2008, National Amusements Chairman of the Board Sumner Redstone sold 87% of his stake in Midway to a private investor named Mark Thomas for only $100,000.  This sale triggered Midway’s creditors to demand a repayment of debts at about $150 million worth.

“This was a difficult but necessary decision,” stated Midway’s Chairman, President and CEO Matt Booty. “We have been focused on realigning our operations and improving our execution, and this filing will relieve the immediate pressure from our creditors and provide us time for an orderly exploration of our strategic alternatives. This Chapter 11 filing is the next logical step in an ongoing process to address our capital structure.”