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Samsung looks to borrow $1 billion to expand production capacity in Austin, Texas
When you're producing chips for the iPad and iPhone, you need a serious facility to meet those demands. And evidently, Samsung's not foreseeing its legal battles with Apple to cause any wrinkles in said plans. In fact, Bloomberg is reporting that Sammy has "sent requests for proposals to banks to borrow as much as $1 billion to expand production capacity at its factory in Austin, Texas," with the bonds to be issued by Samsung's US unit. It's bruited that the company -- which has around $19.2 billion in cash -- may sell its first overseas bonds since 1997 due to the impossibly low cost of borrowing money these days, and in a time where positive economic news is tough to come by, it's quite the relief to see a bit of forward progress come from historically low interest rates. Reuters is reporting that the investment will mostly be used to "boost production of mobile chips and next-generation OLED (organic light-emitting diode) display panels," but specific details beyond that remain murky.
But you can't get the Romania out of Nokia
Local news outlets are reporting that Nokia is in trouble with the Romanian government over unpaid debts amounting to $10 million. The outstanding sum supposedly relates to customs bills racked up by trucks removing Nokia's equipment from its abandoned Cluj factory. A Nokia spokesperson just confirmed to us that the company is experiencing some kind of problem in that country, but is "engaging with the local authority to ensure it will be resolved satisfactorily."
Visualized: Google charts the rise and fall of United States revenues
Where would we be without Google? Well, we wouldn't have pretty charts to gawk at, for starters! The Mountain View squad has pulled 10 years' worth of fiscal data from the US Census Bureau and compiled it into some gorgeous, infinitely sortable, and re-organizable graphs. They inspire both our admiration and apprehension, as their lines illustrate most starkly the shrinkage that replaced US economic growth over the latter half of the last decade. We've only picked out a few of the big states here, but all 50 are in Google's public database -- why not hit the source link and check up on your local governors' pecuniary (mis)management skills, eh?
Plastic Logic receives massive $700 million Russian investment
Who can forget the Plastic Logic Que proReader -- a textbook study on the vaporous gadget. Start with an incredible (but truthful) claim to have developed plastic semiconductors that could be used to fabricate flexible e-reader displays. Then follow up the breakthrough with the all-important consumer tease: an amazing (for the time) 8.5 x 11-inch e-reader with a gesture-based UI that would launch in the first half of 2009. Unfortunately, the Que never shipped and was ultimately canceled, partly because of reliability issues associated with manufacturing those early Que displays and partly because of the launch of a rather disruptive Apple tablet you might have read about. Fast forward to today and we've got the state-owned Russian Corporation of Nanotechnologies (Rusnano) announcing a $700 million investment in the US-based Plastic Logic Inc. Why? Are you listening? Plastics. Here's how this "unprecedented" investment was described by Georgy Kolpachev, Rusnano's managing director: "Flexible plastic electronic displays will provide another major milestone in how people process information. Entering this new disruptive segment at the stage of its inception gives Russia a chance to win a leading position in global market of future electronics." The investment will be used to pay off Plastic Logic's debt including a $50 million loan the company took out after approaching financial collapse. The rest will be used for a second plastic electronics factory in Russia (a sister to the Dresden Germany plant) which is expected to start production in 2013 or 2014. Update: Press release added after the break offering more details on the "world's largest commercial plastic electronics factory" that will be capable of producing hundreds of thousands of "next-generation plastic electronics displays" per month.
SouthPeak gets $10 million loan while losing biggest moneymaker
Outside of looming legal battles and down year-over-year revenues, SouthPeak recently received a $10 million "asset-based line of credit" that extends until February 28, 2012, reports IndustryGamers, effectively replacing an $8 million line of credit previously secured. We're not quite sure what debtors will have to take from SouthPeak should the publisher not be able to repay the $10 million, though, as Majesco Entertainment apparently scooped up SP's biggest franchise in mid June, My Baby. For what it's worth, SouthPeak chairman Terry Phillips said of the credit, "Securing this additional credit provides us with greater financial flexibility and presents a clear message to our investors that we are confident of our business prospects and growth opportunities over the near- and long-term." Here's hoping that Two Worlds 2 and Battle vs. Chess are enough to help the company get its feet back on the ground in the coming year.
Blockbuster avoids bankruptcy for now, but not NYSE delisting
Things stateside haven't gone the way of Blockbuster Portugal (yet) but while the Blockbuster was able to make arrangements with creditors and avoid bankruptcy this week, it will be forced to delist from the New York Stock Exchange after a proposed reverse stock split fell through. Even the extension on debt payments it was able to negotiate hasn't satisfied analysts, with our old friend Michael Pachter telling Reuters "there's nothing on the horizon that makes it look like Blockbuster is going to be more profitable." Ouch. A substantial amount of debt has long been a problem for Blockbuster as it tries to adjust to a changing marketplace with Redbox and Netflix, and with shares trading at .18, has now made its existence more precarious than ever.
Pre-teen FarmVille player racks up $1,300 in charges
No, no, no. This simply will not do. There are so, so many things in this world worth buying with money you don't technically have, that we can't sympathize with a 12-year-old boy who, according to the Guardian, ran up a £905 tab (something like $1,380) by purchasing FarmVille funny money through developer Zynga. Since the boy lives with his (unknowing) mother, the company reportedly refused to refund the money, leaving the boy's life savings and the mother's credit card account in a world of hurt. There are a handful of burning questions at the forefront of our minds with this story, the most pressing being: What was the endgame, here, kid? Was your sizable initial investment going to be completely recouped with this season's bumper crop harvest of virtual soybeans?
SouthPeak doubles game sales in 2009 amid dropping profits
Though SouthPeak is keen to point out that its net revenues rose from last year by $7.2 million, the company's profits for the year remain firmly in the red, with a $12.1 million posted loss for the 2009 fiscal year ending June 30. SouthPeak's loss report comes confusingly paired with a 100% increase in units sold from fiscal year 2008 (from 1.2 to 2.4 million units) -- 2009's posted $12.1 net loss gets explained away by "approximately $12.5 million invested in game development and intellectual property for future title releases," among other things. The report also allows "$1.6 million of expenses relating to the Gamecock acquisition," hopefully some of which went to paying Gamecock debt now owed by SouthPeak -- this on top of another $4.6 million or so for "charges relating to write-downs on software values and sequel right values to certain titles." Unsurprisingly, the publisher hopes that upcoming titles Two Worlds 2 and My Baby: First Steps, as well as a "highly-anticipated sequel to Dementium," will bolster its next fiscal year. We're just hoping the games the company does sell will actually garner some profit this time around.
Qualcomm takes a piece of Pantech
Korea's Pantech has always played second fiddle (well, third fiddle, we suppose) to global giants Samsung and LG, but somehow, the little guy has managed to be cash flow positive for the past eight quarters of financial results since undertaking a corporate restructuring. To further strengthen its position, it's in the process of swapping some outstanding debt for equity -- and one of those creditors just happens to be Qualcomm, which has a booming Korean business and enjoys tight relationships with many of the local players. This sounds like it won't really have any material effect on Pantech's day-to-day operations, since Qualcomm says it wants to stay passive and won't move to install any management or board members; that being said, it could end up with as much as 15 percent of Pantech's common stock, which is a nice little chunk. We're guessing this means we won't be seeing many Pantechs with Broadcom basebands, eh? [Via Unwired View]
Midway stalls for more time, still scrounging up cash
After negotiating a small measure of breathing room last week and delaying the payback of a portion of its staggering debt, fate has again smiled on Midway. GI.biz now reports that the embattled publisher has again talked its way out of a corner, pushing back the deadline to repay the back end of the $150 million it owes to stakeholders until February 12. We'll pause as execs take a moment to wipe the sweat from their collective brow. Still, we can't help but wonder if Midway wouldn't be waiting for shareholders to slip the noose around its neck in the first place if it had put the kind of energy into developing quality games that it has in delaying the company's financial collapse.
Time extension: Midway gets extra month to pay off debts
Midway has picked up a time bonus, turning back the clock somewhat on its 50-day fast track to financial doom. The troubled Mortal Kombat publisher has negotiated some breathing room for itself, extending the deadline to pay back half of its crushing $150 million in debt by another month until February 19. Of course, this still leaves $75 million to fork over to investors in a couple weeks, though Midway notes that it is currently "in discussions" to push back the repayment of this debt as well. When things are going south as quickly as they have gone for Midway, you take your victories where you can, though unless Midway expects next month's Diesel-fueled Wheelman to drive to the front door with a bag of cash, we wouldn't stop looking under the rug for loose change just yet.[Via Variety]
Analysts ponder Charter, Univision futures as debt payments loom
We've known for years that Charter Communications isn't what you'd call a "stellar" cable operator, but we had no idea things were looking this dire for the outfit. According to a new report surfacing at Reuters, the St. Louis-based MSO is currently holding a net debt of around $21 billion, and it has purportedly said that it may need to "go into bankruptcy to deal with that burden." In order to stay afloat this long, it has "refinanced and extended its maturities every year since 2004," and just before Christmas it asked a longtime financial adviser to "start talks with bondholders to boost its financial flexibility." In related news, things aren't looking much brighter for Spanish-language media giant Univision, which recently reported a stiff 25% drop in automotive advertising. For awhile, it seemed the media firms were almost untouchable, but the recent downturns in the economy could be taking their toll on a few mainstays. Ah well, at least Charter subscribers can now somewhat justify those rate increases... somewhat.
Finish him: Midway facing 50-day countdown to bankruptcy
Things are looking grim for the company that once gave us Gorf, Arch Rivals and Spyhunter. The Chicago Tribune reports that Midway may default on its staggering $240 million debt, and that according to an SEC filing the one-time arcade dynamo has just 50 days to get $150 million of this back into the hands of creditors. It's money, unfortunately, that Midway just doesn't have.The Mortal Kombat publisher has enlisted the council of financial advisory firm Lazard, though time is short and money even shorter. The urgency stems from the company's recent change in majority ownership, which allows bondholders to demand full repayment on their investments. However, with Variety reporting just a smidge over $10 million in Midway's coffers, that leaves an awful lot of candy bars to sell over the next month and a half if the company is to keep from filing bankruptcy (let alone being ripped to shreds by investors pounding on the front door).
Midway sinks further after Redstone escape
How low can you go? GI.biz reports that Midway's stock has plummeted some 40% since majority shareholder Sumner Redstone cast off his stake in the company to investor Mark Thomas on Monday and ran for the hills. Midway's stock currently trades for around 23 cents a share, an all-time low and reason why the company continues to face delisting by the New York Stock Exchange. As Midway's dance of financial limbo persists, we can't help but look on and place bets when the troubled company's back will simply give out and snap in two.
Redstone to sell Midway stake for $100K
The week begins with more bad news for financially-hobbled Midway. Just days after finding itself on the business end of a delisting notice from the New York Stock Exchange, the company's majority stockholder, Sumner Redstone, is now preparing to row away from the sinking ship entirely. According to the Wall Street Journal, Redstone and his holding company, National Amusements, hope the separation will help breathe new life into the firm's suffocating $1.6 billion in debt. Redstone is expected to inflict sell his 87% controlling stake in the troubled publisher to private investor Mark Thomas -- obviously someone who enjoys a good fixer-upper -- for the bargain basement price of about $100,000, or $0.0012 a share, well below Midway's previous closing price of .38 a share. The WSJ also points out that the sale is but one point in what has become a highlight reel of bad investments for Redstone, who sunk millions into Midway in hopes of the company's heroic return, only to see it do a fatality on his bank account.
Stargate Worlds studio faces cash flow issues
Get ready for some dubious corporate drama. We were contacted by a tipster claiming to be a Cheyenne Mountain Entertainment employee. He or she alleged, among other things, that CME/Firesky is in critical financial condition -- that it has accrued a large debt, that massive layoffs are planned, and that the future of Stargate Worlds might be in jeopardy. Knowing full well that potentially-scorned anonymous employees are rarely a wholly reliable source, we contacted the company and provided them an opportunity to comment.We were told that the tip was full of inaccuracies and overstatements. The official comment was this: "Cheyenne Mountain Entertainment is a start up, and like many start ups, we face the typical cash flow issues that all pre-revenue companies face. CME continues to fund its operations in the same way it has done for three years and the viability of the Stargate Worlds project is not in question. We fully expect to complete and ship Stargate Worlds in 2009."
Sprint gets slapped with debt downgrade, lawsuit
If there's one thing Sprint doesn't need at the moment, we'd say that "a harder time getting cash" ranks high on the list. That's where big ol' number three finds itself at the moment, though, thanks to a credit downgrade by Standard & Poor's from "BBB-" to "BB," a move that puts its bonds squarely in junk territory. S&P has some harsh words for Sprint regarding the move, too, explaining that it went down thanks to its "assessment that Sprint Nextel's business risk profile is no longer supportive of an investment-grade rating given its deteriorating operating performance and lack of visibility in the wireless business." Lack of visibility in the wireless business, eh? Snap! The junkification of Sprint's debt coincides with the installment of a new CFO -- purely a coincidence, no doubt -- effective immediately.But wait, the bad news isn't over. A workers' lawsuit filed in US District Court last week alleges that Sprint dumped pension plan cash into Sprint stock at a time when... well, let's just say that it wasn't exactly a solid investment. The suit names 12 Sprint board members as co-defendants and looks to recover the money lost as Sprint stock slid into the basement; furthermore, it's looking to garner class-action status, meaning that the carrier could potentially owe money to a whole boatload of employees if the plaintiffs win the whole shebang.Read - Debt downgrade, new CFORead - Pension plan lawsuit
Brace yourself: Ziff Davis is $390 million in debt
Publisher Ziff Davis has been in trouble for a while, and now we know how bad. The publisher skipped an interest payment and is entering into negotiations regarding its $390 million debt. Ziff Davis says they are still operationally "in very good shape," but they still have debt left over from when the company "was a very different scale." The company used to employ 1,200 people, it is now down to 290 and among its many websites (including 1UP), it only has three magazines left: PC Magazine, EGM and Games for Windows. During the attempted sales of its games division it became clear buyers wanted 1UP, but had no interest in the declining magazines.Death in the video game magazine business seems inevitable, unless you're bundled with a mega gaming retail chain's discount card. Although this shouldn't be taken as a sign that EGM and your other Ziff publication's are finished. There's obviously a reason these magazines have survived while the others died off.[Via Evil Avatar]
Man runs up 8k tab in iTunes Store, fiance dumps him
In response to a call for readers' most embarrassing DVD purchases on Entertainment Weekly's website, Dalton Ross got an interesting comment from a woman named Susan who thought it might be fun to share with the world why her engagement was called off.I used to wonder how my husband-to-be had more than 700 music CDs and more than 300 movie DVDs and hundreds and hundreds of record albums until I discovered that he had $43,000 in credit-card debt. In looking at his last bill (for one month) he had charged more than 8,000 iTunes at 99 cents each and had charges at places that sell music and movies, too. This guy made $45,000 a year. Called off the wedding.If true - and since it's on the Interwebs it must be true - Susan made the right choice! And she saved both of them from even more debt.8000 songs from the iTunes music store? $7920Average cost of a wedding in the US?$27,490Posting about your failed relationship and shattered dreams on the Internet?Priceless.Perhaps someone should introduce this guy to Free Tuesdays? Is there an iTunes Anonymous chapter for guys like this? There's a reason why 1-Click purchasing should be off by default.[via TheAppleBlog]
Researcher dreams up $2.5 trillion "space sunshade"
With all these batteries exploding vehicles running around, we aren't too surprised that researchers at the University of Arizona are getting fired up about stopping global warming, but dropping $2.5 trillion on such a project might just cool the whole idea down a bit. Nevertheless, astronomer Roger Angel thinks that launching a "constellation made of trillions of small, free-flying spacecraft parts a million miles above Earth" could form a long, cylindrical cloud to reflect "about 10 percent" of the sun's rays away from our planet. The lightweight flyers hanging around in the L-1 orbit would be crafted from "transparent film pierced with small holes," utilizing "MEMS" technology mirrors as tiny sails that hold them in line while drifting about. The idea gets even zanier when referring to shooting the "20 million ton structure" into space; it's been suggested that "20 electromagnetic launchers" running on hydroelectricity could launch a stack of flyers "every five minutes for ten years" to complete the project, and while he feels that even the massive sunshade is no substitute for "developing renewable energy," that's still a huge chunk of coin to drop on something so, um, outlandish.[Via Primidi]
