Rogue Warrior developer Rebellion Derby is to be closed down.
The developer, which is spread across multiple locations, had to "review the need for the Derby facilities" as its Oxford and Runcorn teams grow.
CEO Jason Kingsley described the process as "painful". Staff in Derby are currently being consulted about their future. GamesIndustry.biz has heard that a number of staff have already been made redundant.
"Growth is sometimes painful, never more so than in the current climate and we have had to take a long hard look at how we operate our studio network," said Kingsley in a statement. "Strategically we have decided to review the need for the Derby facilities, and consultation with staff at Derby is ongoing."
The Derby studio, originally the Core Design team responsible for Eidos' Tomb Raider games, was acquired in 2006. The studio recently released Rogue Warrior: Black Razor.
The lease for the building is also coming to an end, and Rebellion has said that it intends to make further announcements on the studio in the coming weeks. Rebellion's Oxford studio is currently working on Aliens Vs Predator for publishing partner SEGA.