Mad Catz, Inc. has filed for chapter 7 bankruptcy in the United States. As of March 30, the company has shut down and begun to sell off its assets, with all proceeds going straight to lenders.
Chapter 7 bankruptcy differs from chapter 11 bankruptcy in a major way: It means that Mad Catz does not currently intend to reorganize, filing instead for liquidation and vacating its board of directors and officers.
Best-known for its gaming hardware and peripherals, Mad Catz’s exit from the industry follows several months of financial trouble. Poor Rock Band 4 sales in late 2015 rocked Mad Catz, after it hedged its bets by co-publishing and designing instruments for the game. The company told investors that it needed Rock Band 4 to succeed in order to stabilize itself; that didn’t happen, and the company posted huge losses in the quarter after its release.
In February 2016, Mad Catz’s CEO and chairman both resigned, and the company laid off nearly 37 percent of employees. Leading up to the bankruptcy filing, efforts to increase shareholder value failed on a public level; we reported in January that Mad Catz’s stock prices had plummeted, and the company was at risk of being removed from the New York Stock Exchange.
The board of directors voted to cease operations following these failed moves to boost profits. Going bankrupt is an unfortunate, if not unexpected ending for the company, as well as hardware heads who’d collected Mad Catz’s controllers, flight sticks and other products since it opened in 1989.