HispanicBusiness

The US arm of video game pioneer Atari has filed for bankruptcy, in a move that would separate it from its ailing French parent company and allow it to forge ahead with plans to use its classic games such as Pong and Asteroids on digital and mobile platforms.

Atari Inc filed for Chapter 11 reorganization in New York after the lapsing of a credit facility with London-based financial company Blue Bay Asset Management, the company said in a statement Monday.

Despite recording positive current operating income in 2011 and 2012, "the company has been starved for funds and unable to finance its continued growth," the statement said.

Atari Inc, which has just 40 US employees, has nevertheless secured a commitment for 5 million dollars in debtor-in-possession financing to continue operations and release games.

"In light of the current situation with BlueBay, we have decided to take what we think is the best decision to protect the company and its shareholders," Atari chief executive officer Jim Wilson said.

"Through these ongoing procedures, and especially the auction process in the US, we will seek to maximize the proceeds in the best interest of the company and all of its shareholders," Wilson said.

Atari was founded in 1972 and was a pioneer in arcade games, home video consoles and home computers that helped shape the emerging market of the computer entertainment industry.