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Index Corporation, the parent company of game developer/publisher Atlus, has filed for bankruptcy. The holdings company, which also has stakes in anime studio Madhouse and Japan’s oldest movie studio Nikkatsu, has a reported liability of ¥24.5 billion (which is roughly $248.7 million USD).

From our understanding, Index wants to go through a restructuring – similar to what automotive companies GM and Chrysler went through back in 2009, rather than the liquidation that THQ went through earlier this year. Index apparently wants to come out of bankruptcy with a focus on digital gaming through both mobile platforms and social gaming. What that ultimately means for Atlus is still unclear. All that we know for sure is that Index is looking for potential sponsors to help them out.


Proceedings could become dicey as Index is also under investigation for unlawful business practices. According to the Japanese Security and Exchange Surveillance Commission, Index has taken part in a fraudulent practice colloquially known as “window-dressing.” It is a form of round-trip transaction used to inflate sales numbers in order to have the appearance of profitability. What happens is that one company sells a number of units to another with a promise of buying back the same number of units for the same price. The result of this, besides the appearance of being profitable, is an inflated stock price. Nothing has been confirmed as to who else took part in this, but there is speculation that another gaming company as well as a hedge fund manager and a Japanese bank could have been involved. But again, nothing has been confirmed.

As for the bankruptcy, the process that Index has chosen, called “Rehabilitation,” is rather streamlined, especially compared to bankruptcy in the US. First and foremost, the debtor management can stay on to help form a plan for either recovery or liquidation. However, if a party can prove managerial incompetence, a trustee will be called upon to lead. There is no shareholder vote which will make the process much quicker than US bankruptcy. Creditors will have a vote when it comes to approving the plan. All total, the process should take about 6 months.

Sources: 1, 2, 3, 4

Jeff Neuenschwander
Jeff has been a supporter of the website and campaign since the beginning. Joining in for E3 2012, he worked his way up the ranks quickly, making it to the Editing Manager post at the beginning of 2013. Jeff has a wide variety of tastes when it comes to gaming and pretty much likes anything that is quirky, although his favorite genres are Action, Platforming, and RPG. Outside of gaming, Jeff is a musician, being trained as a trombonist for Jazz and Classical music, and holds a degree in Sound Recording.