Codemasters buys Sega Racing Studio

Earlier in April, it looked like the death knell had been sounded for Sega Racing Studio, when Sega confirmed that the Solihull-based studio was to be shut down. However, the Sega Rally Revo developer is being saved from the scrapyard, as today Codemasters announced that it will take over the studio with immediate effect.

Codemasters is already well established in the racing genre, having produced the Colin McRae series of rally racing games, which evolved into DiRT last year, as well as the TOCA racing series, known in its upcoming iteration as Grid.

"In seizing this opportunity, we have created additional resources to escalate our plans in the racing segment," Codemasters CEO Rod Cousens said. "We hope to welcome more than 40 people to the company and we have enjoyed the full cooperation of our friends at Sega in making this happen."

As for why the racing studio was set for closure in the first place, Sega cited the underwhelming sales performance of its flagship title, last year's Sega Rally Revo, for the Xbox 360, PlayStation 3, and PC, as a factor. A PSP edition of the game was handled by external studio Bugbear Entertainment.

"The decision is part of a review of Sega's Western Development Studios to ensure that each studio is a profitable entity in its own right," the company said, "and unfortunately the Sega Racing Studio's five-year plan would not result in a successful return for the Sega business moving forward."

The closure would have been yet another blow for the British game development industry, which has slipped from third to fourth place in the global rankings as Canada has increased its investment into the industry. This is despite the increase in game sales in the UK, which generated revenue of £418.4 million ($828.9 million) in the first quarter of 2008, according to the Entertainment and Leisure Software Publishers Association.

Gavin Cheshire, vice president of Codemasters Studios, told GameSpot, "Codemasters Studios is on a constant growth curve; in the last 12 months we have opened and staffed up our Guildford studio, and taking over the Sega Racing Studio could take our development headcount over the 350 mark, creating a massive force in British game development. We've invested in talent, created smart technology, and, with this move, we're very proud to be able to offer the development talent at Sega Racing Studio the opportunity to be part of a great team."