Midway money troubles worsen, time running out to repay debt

Midway Games is running out of time. The much-loved, much-respected publisher of classic arcade games such as Mortal Kombat, Defender, Smash TV, and Spy Hunter may default on US$240 million in debt according to the .

An integral part of the video game industry in the 80s and 90s, the arcade-focused Midway Games has struggled mightily to transition to a gaming world ruled by home consoles such as the Xbox, PlayStation, and Wii. Midway's latest game, Mortal Kombat vs. DC Universe, is seeing strong early sales. Unfortunately, that may not be enough to save the cash-strapped publishing legend.

Making matters worse is that Sumner Redstone, Midway's largest shareholder, just sold off his 87% stake in the company for a mere $100,000 (plus $70 million in debt) with no advance warning to Midway. And today, Midway warned that it might default on $240 million in debt, if bondholders request full repayment as is expected.