Sega offers $26.6M for Relic Entertainment in THQ auction, ZeniMax bids $26.3M

Vancouver-based Relic Entertainment, developer of the Company of Heroes and Warhammer 40,000 franchises, has been provisionally acquired by Sega at auction today for $26.6 million, according to a letter from THQ officials provided to Polygon by a former THQ employee.

Sega's bid to buy Relic remains a proposal for now, pending approval by a U.S. bankruptcy court judge. ZeniMax Media, parent company of Bethesda Softworks and id Software, has submitted a backup bid of $26.3 million, in case Sega's offer doesn't go through. The auction began yesterday and concluded today, with THQ's brands up for bidding from publishers large and small.

"We expect that most employees of the entities included in the sale will be offered employment by the new owners," reads the letter from THQ CEO Brian Farrell and president Jason Rubin. Kyle Berndt, a developer at Relic, tweeted, "I now work for Sega. Neat," earlier this afternoon. The THQ executives cautioned that the studios' new owners may have different plans, including reducing staff.

If the bankruptcy proceedings play out as listed in the letter, THQ will no longer exist as a company, according to Farrell and Rubin.

Relic primarily develops strategy games on PCs and consoles, including critically acclaimed recent titles like Warhammer 40,000: Dawn of War 2 and Company of Heroes, the latter of which is set to receive a sequel this spring. The studio also has a project codenamed "Atlas" in development and scheduled for release in 2014, according to THQ's bankruptcy filing.

An auction summary filed with the federal bankruptcy court in Delaware indicates that the acquisition of Relic would cover the studio and the Company of Heroes IP. The fate of the Warhammer 40,000 series — the rights for which are licensed from their owner, Games Workshop — remains unknown at this time.

"I now work for Sega. Neat"

Sega's current portfolio includes the Total War strategy games developed by The Creative Assembly. Last month, the publisher announced a licensing agreement with Games Workshop for a new team at The Creative Assembly to develop games set in the Warhammer universe; the first one is set for release sometime after 2013.

"It has been our privilege to work alongside the entire THQ team," Farrell and Rubin said. "While the company will cease to exist, we are heartened that the majority of our studios and games will continue under new ownership."

We're reporting live from the hearing and will continue to bring you updates on the story as they come in.

Update: A Sega representative told Polygon, "We have no comment at this time."