Kuju boss Ian Baverstock has told GamesIndustry.biz that the company's Chemistry studio will close imminently unless a last minute management buy-out deal happens.
The Kuju group is also to absorb its Nik-Nak studio in Guildford into the growing Zoe Mode collective, which already has offices in Brighton, London and San Francisco.
"With Chemistry the studio is either going to be sold to its management or it's going to close," confirmed Baverstock, speaking exclusively to GamesIndustry.biz.
"We're currently in discussions with the management about them taking over the studio and that's what we hope will happen, but if it doesn't succeed we'll be closing the studio."
Kuju's Nik-Nak studio was originally created to focus specifically on product for younger gamers, but has seen some crossover with Zoe Mode, the studio working on casual and family-orientated titles.
"Nik-Nak was set up a few years ago to focus on games for children and at the same time Zoe Mode grew alongside looking at the broader, family space," said Zoe Mode boss Ed Daly. "From the outset we were aware of a potential for overlap and one of the projects worked on by that team originated as a Zoe Mode concept."
Nik-Nak now becomes Zoe Mode Guildford, bringing the headcount in that group to around 160.
"We need to make sure the brands are coherent and not in each others way and there's a basis there to build something of value. So it ended up making a lot more sense to not continue with Nik-Nak as a separate brand and for them to become Zoe Mode Guildford," clarified Daly.
Baverstock added that the company's other studios Headstrong and Doublesix are not affected by the changes.
"We're running multiple business units, and Zoe Mode, Headstrong and Doublesix are going great guns," he said.