R.I. Officials Studying Finances Of Schilling Company
BOSTON — With the aim of “keeping 38 Studios solvent,” Rhode Island Gov. Lincoln Chafee’s office has been meeting with Curt Schilling’s video game company about its finances.
According to the Providence Journal, which first reported the discussions, Chafee said on Monday that he’s examining “all the financials” and working at “protecting taxpayer dollars.”
The company released its first game — “Kingdoms of Amalur: Reckoning” — in February.
The former Red Sox pitcher moved 38 Studios to Providence from Massachusetts in 2010 after Rhode Island offered the company a $75 million loan guarantee. In return, the company pledged to expand to 450 employees. WPRI-TV reports that 38 Studios has so far received about $50 million from Rhode Island and currently has 288 employees based in Providence.
WPRI adds that the company’s finances have previously been scrutinized:
Last June, PricewaterhouseCoopers audited 38 Studios and issued a “going concern” opinion that expressed “substantial doubt” about whether the company would be able to stay solvent, the disclosure filing said.
Multiple outlets have not yet received comment from 38 Studios.
Rhode Island officials approved the loan guarantee before Chafee, who criticized the deal in his campaign, took office. According to the ProJo, however, “he has since said it’s important now to work with it and make sure it succeeds.”
In 2010, Massachusetts declined to bid against its neighbor with a competing loan offer.
“I’m sorry for [Schilling] and his employees, and I hope things work out,” Gov. Deval Patrick told the Boston Herald Tuesday, when asked about the news out of Rhode Island.
Update at 3:30 p.m.: Video game analyst Billy Pidgeon told our Newscast unit that any financial uncertainty at 38 Studios is most likely linked to the high cost of developing the company’s latest product:
You need to maintain this considerable amount of overhead to continue to work on a massively multi-player online game that’s going to compete worldwide.