Midway "haemorrhaging cash at an alarming rate"

Struggling publisher Midway is expected to use up 75 per cent of its cash reserves by May this year - over USD 12.4 million.

That's according to documents filed by the company's new owner AHS, which has stated that the Mortal Kombat company is "haemorrhaging" cash as it claws its way through bankruptcy.

"It is beyond dispute that the debtors [Midway] have an immediate need to access and use AHS's cash collateral. Nor can it be disputed that, based upon the debtors' 13 week forecasted budget, the debtors are haemorrhaging cash at an alarming rate.

"Indeed, the debtors' budget indicates that between February 9, 2009 and May 4, 2009, the debtors will burn through approximately $12,392,598 in cash representing approximately 75 per cent depletion of its cash reserves."

Midway stakeholders have questioned AHS's owner Mark Thomas, who purchased the majority of Midway for USD 100,000 in what they consider a secretive deal.

However, AHS's disputes any wrong doing, and called the stakeholder's concerns "irrelevant factual allegations."

Yesterday it became clear that Midway is seeking to sell off its assets to generate cash in the short term, with it's best-known IP Mortal Kombat up for sale.