Capcom today announced plans to dissolve its wholly owned Clover Studio after a decision made at the publisher's Board of Directors meeting.
Originally established in July 2004, the studio's lineup of critically acclaimed titles included the quirky action game Viewtiful Joe, as well as a pair of games that saw release only in the US: the Japanese-folklore-inspired Okami and the tongue-in-cheek brawler God Hand.
Clover Studio employed an all-star lineup of Capcom development talent, including Atsushi Inaba (producer of Steel Battalion and Viewtiful Joe), Shinji Mikami (Resident Evil creator), and Hideki Kamiya (Devil May Cry director).
The developer was based in Osaka, Japan, where Capcom itself is also headquartered. Clover Studio was so named as an abbreviation of "creativity lover" and because "the four-leaf clover...signifies happiness and creativity." The company was set up to make innovative games that would "inspire the future of gaming."
The announcement came as a shock to many, with the reason for the dissolution stated in the press release as follows: "Clover Studio Co., Ltd. has met the goal of developing unique and creative original home video game software, however, in view of promoting a business strategy that concentrates management resources on a selected business to enhance the efficiency of the development power of the entire Capcom group, the dissolution of Clover Studios Co., Ltd. has been raised and passed at a Board of Directors' meeting." The company will be officially dissolved at the end of March 2007.
Capcom also released a notice of revision of earnings and dividend forecast. The report explained that although there had been favourable growth in sales of Dead Rising, the Mega Man Battle Chip Stadium arcade game had not performed well.
The dissolution of Clover Studio comes after Capcom pulled themselves out of spiralling losses. In 2003 they announced losses of $163 million and shelved plans for 18 previously scheduled games. However, the company appeared to have bounced back and reported a healthy $7.02 million profit in this year's first quarter.
Capcom added on the end of the press release: "The impact of the dissolution of Clover Studio Co., Ltd. on the financial forecasts, separately announced on the same day, is inclusive as part of Extraordinary Losses amounting to 400 million yen," or approximately $3.5 million.
Earlier this year, reports emerged that Capcom had shut down Studio 8, the developer responsible for the Maximo games. While the publisher declined to comment at the time, it later confirmed the closure of both Studio 8 and its distribution arm, Capcom Eurosoft, in its year-end fiscal results.