Categories: News

38 Studios struggling with critical debt due to failed loan

Kingdoms of Amalur developer 38 Studios has made the news with reports of serious financial instability.

The company failed to make a $1.125 million loan repayment this month. The Rhode Island Economic Development Corporation granted 38 Studios $75 million when it moved to Rhode Island in 2010.

The money helped cover Kingdoms of Amalur: Reckoning, which only sold 330,000 copies in the US during its first month, and the developer's upcoming MMO, Copernicus. We scored Reckoning a cool 8.5/10, and reviews from other critics have largely been positive, but no doubt poor game sales worsened 30 Studios' troubled financial standing.

The Rhode Island-based developer also missed payroll this week for its 379 full-time employees, according to local news organization WPRI.

In the midst of the situation, executive director Keith Stokes stepped down from his position at the Economic Development Corporation. Stokes helped orchestrate funding for 38 Studios.

WPRI stated that taxpayers will now shoulder the burden left by the developer through 2020, and IP rights will now belong to Rhode Island, reports Joystiq.

Follow @wita on Twitter for tales of superheroes, plumbers in overalls, and literary adventures.

[Gamasutra]

Stephanie Carmichael

Twitter: @wita

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