Midway Newcastle shuttered, Chicago layoffs 'imminent'

[UPDATE] Following Warner Bros. buyout, publisher closes UK branch and is set to downsize its Chicago operations; San Diego studio looks likely to close on August 31.

Following a protracted bankruptcy and some last-minute legal wrangling, Midway Games has finally been sold. According to a corporate spokesperson, "the sale to Warner Bros. of substantially all of the assets, IP, and trademarks of Midway Games was closed this past Friday."

[UPDATE] Midway has not yet officially revealed how the sale will affect its Chicago, Illinois, headquarters. However, a source close to the operation informed GameSpot that "layoffs are imminent" among staffers who were not hired by Warner Bros.

Any staff reductions will likely not affect the developers behind Midway's flagship fighting series, Mortal Kombat. Last month, series creator Ed Boon indicated that his team is hard at work on the next game, which will return to the franchise's ultraviolent, M-for-Mature-rated roots. The series, which is also reportedly providing the basis for a third Mortal Kombat film, was one of the main reasons Warner Bros. offered $33 million for the majority of Midway.

Midway did confirm that its British shop, which was not bought by Warner Bros., has been shuttered. "We can confirm that the Newcastle studio has been closed following the notification period required by UK law," a rep said. "We made every effort to find a buyer for the studio, but unfortunately, none emerged during the period." About 80 people worked at the studio, which developed this year's Vin Diesel vehicle The Wheelman. The fate of its current project, the action game Necessary Force, remains unclear.

Things are also not looking good for Midway's San Diego studio, which, too, was not part of the Warner Bros. acquisition. According to a filing with the Securities and Exchange Commission last week, Midway is planning to close the San Diego studio, which employs about 20 percent of the publisher's overall workforce. The company is also taking a write-down of $4 million as a result of the cancellation of an unnamed game, which was in the works at the Southern California shop.

"Midway San Diego has been given 60 days [on July 1] notification under the WARN act, and as long as the studio is open, it is possible for bidders to make an offer for the studio," a rep told GameSpot. The WARN--or Worker Adjustment and Retraining Notification--Act was passed in the late 1980s and requires employers to give two months notice to employees in case of "mass layoffs."

46 Comments

  • Darkside7972

    Posted Jul 17, 2009 7:14 am PT

    "Midway only published "Mortal Kombat Advance". It was developed by
    Virtucraft, Ltd. Try doing some research before you talk sh*t. It took me less than 60 seconds to find out who the developer was... All I knew to begin with was it wasn't Midway. Before I made this post I made certain. It's real easy. Well, not if you're a lazy, douche, web-troll."

    So? Remove "Mortal Kombat Advance" from my post and everything else I said is still valid. Why are you being so defensive anyway? Mad that you've got to toss your employee ID in the garbage? Or is it the more realistic option: you're a mindless Midway fanboy that thinks that the mediocre garbage they've released over the years is actually worth playing, and now you're mad that everybody else has realized the exact opposite and have spoken with their wallets? No more subpar Midway games for you, boo hoo. Take off your fanboy goggles and realize that just because I'm not holding a candlelight vigil for the employees like a lot of people in this thread doesn't automatically make me a "web-troll." I was merely stating the truth, and furthermore why the hell should I defend or even feel sorry for a company that clearly struggled just to be average, yet put forth ZERO effort to be considered something great?

  • railroberto2007

    Posted Jul 15, 2009 11:58 am PT

    this happens when you sit around playing video games all day instead of making them

  • resevl4rlz

    Posted Jul 15, 2009 9:32 am PT

    dam i was hoping to get a internship at my midway at chicago and now there are no game companies in illinois

  • nelo_inc

    Posted Jul 15, 2009 9:02 am PT

    Let me teel you that this news are very sad,there are jobs that will be lost.But Midway didn't made a good game in a long time,the Mortal Kombat series since Ps2 aren't good enough to keep up with better fighting games like Tekken or Soul Calibur.I have the Mortal Kombat Vs Dc Universe and it's nothing special.Got make good games to keep up!

  • sirkibble2

    Posted Jul 15, 2009 8:20 am PT

    This is sad. I am hoping the SD locale stays open. I know a person who was trying to get a job there...

  • darklight4

    Posted Jul 15, 2009 8:18 am PT

    damn all these businesses closing im surprised that some people still have jobs
    bad times man

  • Tzunoy

    Posted Jul 15, 2009 8:05 am PT

    Hey Ed Boon make a new Mortal Kombat but this time the real mk just like the old ones but this time stop playng and make it violent like the title says Mortal Kombat never forget that. Make it like SF4 a mix between the 2D and 3D and change the combo link make it like in Killer Instinct this way you will reborn again that's for sure.Listen to the fans and you will succed.

  • CamiKitten

    Posted Jul 15, 2009 5:46 am PT

    Things just keep looking worse everywhere. Hopefully the people laid off will get back on their feet.

  • Logic_Crocodile

    Posted Jul 15, 2009 5:12 am PT

    Bad times man, bad times.

  • Filaki

    Posted Jul 15, 2009 4:26 am PT

    It's never good when a company closes. I've had enough with this financial crisis, it's even worse when people lose their jobs because of factors that are not directly under their control. Best of luck to everyone who got laid off.

  • pakhair

    Posted Jul 15, 2009 3:05 am PT

    What a bad luck for the employs of both studios of Midway..........

    I don't know what will happen to the IPs .............

  • jjwalker9600

    Posted Jul 14, 2009 10:57 pm PT

    Bad news for the gaming industry and especially for the employees of Midway

  • warlok123

    Posted Jul 14, 2009 10:29 pm PT

    killer instinct was better than mk...

  • Coco_pierrot

    Posted Jul 14, 2009 8:42 pm PT

    well , it is sad that they shut the door, but they have always do mediocre game. Mk was good until Mk3 ( Mk 1 and 2 was made by Acclaim ). Maybe Mk will be back ... I just hope Warners will look at what they do and make sure the product si good quality.

  • Fallout_red

    Posted Jul 14, 2009 8:29 pm PT

    MK9 better be a hard M because they HAVE to make up for the lame fatalities of that T rated MK vs DC. God it was a direct insult to those that grew up with this series like me. Gamers and fans deserve better.

    Best of luck to MK team as well as those that lost their jobs.

  • jrabbit99

    Posted Jul 14, 2009 8:02 pm PT

    more bad news for the gaming industry

  • xsoulx

    Posted Jul 14, 2009 7:22 pm PT

    Midway only published "Mortal Kombat Advance". It was developed by
    Virtucraft, Ltd. Try doing some research before you talk sh*t. It took me less than 60 seconds to find out who the developer was... All I knew to begin with was it wasn't Midway. Before I made this post I made certain. It's real easy. Well, not if you're a lazy, douche, web-troll.

  • wwonka666

    Posted Jul 14, 2009 7:01 pm PT

    Midway mis-managed itself into bankruptcy. Although, Stranglehold should have done better for the company as well as the Wheelman, they didn't so now Midway is history. I personally won't miss them, make a good game and slap crap-games on the box and I will check it out.

  • SWIFFT

    Posted Jul 14, 2009 6:35 pm PT

    Sorry to hear this. I wish everyone the best of luck finding new companys.

  • PublicNuisance

    Posted Jul 14, 2009 6:11 pm PT

    If they were just going to lay people off why not sell the studios as well ? They could of got more money.

  • robfield

    Posted Jul 14, 2009 6:01 pm PT

    Midway should have downsized a long time ago. They haven't had a hit game in years.

  • Homerj

    Posted Jul 14, 2009 5:51 pm PT

    Between Blacksite Area 51 (the worst game ever released on any platform) and releasing a T rated Mortal Kombat, I'm surprized that it took this long for the locks to go on the doors.

  • BtmnHatesRbn

    Posted Jul 14, 2009 5:49 pm PT

    What is "shuttered"? Nobody uses that word in the real world. USE THE DAMN WORD "CLOSED"!!

  • brian_13un

    Posted Jul 14, 2009 5:25 pm PT

    Too bad

  • chappy_man

    Posted Jul 14, 2009 5:22 pm PT

    i hope the employees are well off

  • StillFreeTagger

    Posted Jul 14, 2009 4:45 pm PT

    I heard that they'll no longer be called Midway.

    As long as development on MK9 continues, I'm good.

  • jones_kyle

    Posted Jul 14, 2009 3:46 pm PT

    So what happens to This is Vegas?

  • Darkside7972

    Posted Jul 14, 2009 3:13 pm PT

    Meh. Midway has been going down a slippery slope over the past decade or so. They had to reach the bottom sometime.

    I honestly can't remember the last time that I played a Midway game that could be considered great or even good. Between blatantly rushed titles (Blacksite: Area 51), mediocre license half-assing (Wheelman), and failed series reboots (L.A. Rush), it should be obvious that the company was way past its prime. And that's not even mentioning their REALLY bad stuff (War Gods, Mortal Kombat Advance). The only thing keeping them afloat was the MK license, and it DEFINITELY wasn't because the last few MKs were good--it was selling purely on some sick brand name recognition. The phenomenon was similar to diehard Sonic fans; no matter how apparent it became that the series will never recapture its former glory, people still kept gobbling it up.

    Good riddance, I say.

  • BioShockOwnz

    Posted Jul 14, 2009 2:56 pm PT

    That's too bad. I found Wheelman fun. It was a good first effort by the Newcastle team, I thought. They did a good job making a sandbox game with the Unreal Engine 3, which usually suffers from a lot of pop-in textures and the like in more linear titles. It wasn't great, but like I said, a good first effort.

    Necessary Force could've been greater because of that said experience. The premise was great. This is really too bad.

  • Sepewrath

    Posted Jul 14, 2009 2:50 pm PT

    I guess this is what analyst mean when they say videogames are recession proof. 20% of thier workforce getting laid off, too bad the analyst market isn't recession proof.

  • MadGamer132

    Posted Jul 14, 2009 2:38 pm PT

    i glad midway gone thourgh this, but i feel sorry for the 2 studios no in a deal

  • ferrarimanf355

    Posted Jul 14, 2009 2:36 pm PT

    XBLA/PSN version of The Grid, please.

  • travisstaggs

    Posted Jul 14, 2009 2:36 pm PT

    A game company killed off by the economy, Midway were so great back in the day.

  • Sins-of-Mosin

    Posted Jul 14, 2009 2:35 pm PT

    With Warners' cash, they should be set to make some decent games. Shame they couldn't keep all their sudios but better to have one then none.

  • Spikedjester

    Posted Jul 14, 2009 2:34 pm PT

    its not right*

  • Spikedjester

    Posted Jul 14, 2009 2:34 pm PT

    Its ashame midway. So many crappy developers out there, its not just that you are the one that gets swallowed up by recession. RIP ty for all your contributions.

  • sonictank

    Posted Jul 14, 2009 2:30 pm PT

    ouch two companies going bankrupt it is a very sad week oh well atleast warner saved mk.

  • nintendoboy16

    Posted Jul 14, 2009 2:26 pm PT

    RIP Midway.

  • bschroth

    Posted Jul 14, 2009 2:22 pm PT

    @Shaokahn25:
    read the first paragraph and it'll answer your question

  • nurse_tsunami

    Posted Jul 14, 2009 2:21 pm PT

    I feel bad for those who lost their jobs or are about to

  • firedrakes

    Posted Jul 14, 2009 2:14 pm PT

    cheers!

  • DiscGuru101

    Posted Jul 14, 2009 2:14 pm PT

    At least they get that 60-day notice.

  • Beanmachine12

    Posted Jul 14, 2009 2:10 pm PT

    Well... there goes another gaming company...

  • NuKkU

    Posted Jul 14, 2009 1:55 pm PT

    R.I.P Midway u were a great company that just got swallowed up by the economy

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