News Atlus Games' Index Corporation Files for Civil Rehabilitation Bankruptcy
posted on 2013-06-27 06:20 EDT
The board of directors for Index Corporation, the company that owns and manages the Atlus brand of games, decided on Thursday to begin civil rehabilitation procedures, and it filed an application with the Tokyo District Court that same day. Civil rehabilitation is a relatively new form of bankruptcy procedures in Japan, having been passed into law in 1999. Index lists about 24.5 billion yen (about US$250 million) in debts.
The company plans to continue its operations under the supervision of the court and rebuild. It reported that recent sales in other countries did not increase, just as they expected. However, it anticipates that it will grow in social games and other areas of business with accelerating expansion. As a result, it is looking into selecting a sponsor or sponsors as quickly as possible to transfer its business operations and maintain their value.
Chairperson Masami Ochiai and President Yoshimi Ochiai intend to resign their positions.
Japan's Securities and Exchange Surveillance Commission (SESC) has been investigating Index for allegedly improper accounting via fictitious transactions. Specifically, Index is under suspicion of exaggerating revenues using round-trip transactions. SESC searched Index's headquarters in Tokyo, as well as its chairperson's home, earlier this month.
Index was established in 1995, and was first listed on the JASDAQ securities exchange in 2004. It expanded into the game industry by acquiring Atlus as a subsidiary seven years ago, and Atlus is now an in-house brand of Index Corporation and its privately held subsidiary Index Digital Media, Inc. Atlus has published many popular video game titles, including the Persona series, the Megami Tensei series, and the Snowboard Kids series.