The writing has been on the wall for publisher Starbreeze Studios for some time now. With the poor reception surrounding its PC release of Overkill’s The Walking Dead and significant financial losses reported last quarter, the company is expected to fold within the next 12 months. In what appears to be a last ditch effort to minimize losses, the company is now looking to sell off assets in order to remain afloat for a while longer.
One of those assets being let go is Dhruva Interactive, which Starbreeze Studios has sold its nearly 92% ownership of to Rockstar Games for around $7.9 million. Back in 2016, the Swedish publisher had purchased its majority ownership for $8.5 million, which given the recent history of heavy financial losses for Starbreeze, comes as no surprised the company took a net loss in its investment.
For Rockstar Games, it now owns two studios in the Bangalore, India area. Its own studio, properly named Rockstar India, is located in the same city as Dhruva Interactive, with the latter now being tasked with working alongside the former. The deal will likely close “before the half-year of 2019” according to the official Starbreeze Studios website. Given the likely short lifespan of Starbreeze, it will certainly push for the deal to be completed as soon as possible.
The first quarter of 2019 saw Starbreeze Studios report a massive $17.9 million loss, caused by a number of complications at the troubled studio. While first slated to release on PC before coming to consoles, The Walking Dead’s PS4 and Xbox One versions were canceled within months of the initial November launch. While it might seem as though the decision to cut losses and cancel the console versions was done quickly, it should be noted the game was originally supposed to release in 2016, before numerous delays spiked the game’s development costs.
Following the critical panning the game saw when it released late last year, stories began to surface from the development team who knew Overkill’s The Walking Dead was in rough shape heading into launch. Those who spoke anonymously with Eurogamer earlier this year cited poor management, a lack of identity that would make the game stand out, and simply ignoring reception from preview events claiming the game felt “average” as reasons why expectations weren’t met. By the end of January 2019, the game had failed to surpass 100,000 total sales on steam.
Internal struggles unrelated to development also caused a toxic workplace for staff. Bo Anderson, the former CEO of Starbreeze, was fired as a result of a “reconstruction phase,” with the studio trying to cut as many losses as possible. Other happenings included authorities raiding and arresting one employee for insider trading, though that appeared to have been an isolated incident.
Starbreeze Studios was originally founded in 1998 and is still listed as the publisher for Double Fine Production’s Psychonauts 2. Other games the studios is best known for include PayDay 2, Syndicate, and The Chronicles of Riddick franchise.
Source: Starbreeze, Destructoid