Existing OnLive investor Lauder Partners has been revealed as the new owner of the cloud gaming company.
The value of the deal is unknown. Although the staff of and investors in OnLive are left with little doubt as to the value of their assets – absolutely nothing. Lauder Partners is owned by Silicon Valley venture capitalist Gary Lauder and has to date invested in over 75 companies.
OnLive Inc's board of directors, faced with difficult financial decisions for OnLive, determined that the best course of action was a restructuring under an ‘Assignment for the Benefit of Creditors',”the official statement reads.
The assignee of the company's assets then sold all of OnLive's assets (including its technology, intellectual property, etc.) to the new company. Unfortunately neither OnLive shares nor OnLive staff could transfer under this type of transaction, but almost half of OnLive's staff were given employment offers by the new company at their current salaries immediately upon the transfer, and the non-hired staff will be given offers to do consulting in return for options in the new company.
Upon closing additional funding, the company plans to hire more staff, both former OnLive employees as well as new employees.
The asset acquisition, although a heartbreaking transition for everyone involved with OnLive, allows the company's core innovation and ongoing offerings – the product of over a decade of hard work transforming the OnLive vision into reality – to survive and continue to evolve.”
All Things D reports that the investment ploughed into the first iteration of the company was worth around $56m – all of which has been written off as part of the takeover deal.
But the most startling thing here is the company's audacity. Don't be fooled – the heartbreaking transition” that left former employee's stock options in tatters was deliberately manufactured.
Then there's the term non-hired staff”. That'll be those who have lost their jobs. Fired. Dropped. Sacked. Dumped. Any of these terms would be more appropriate.
But what about OnLive's customers? That are being told that nothing will change and that all services will continue uninterrupted. But with Steve Perlman's initial attempt to acquire funding for the company's astronomically high running costs, there's no immediate reason to suspect that the new owners won't face similar battle.