DJ Hero developer FreeStyleGames has been saved from closure by signing off a new project with publisher Activision.
Around 75 positions will remain at the studio, with the team confirming that approximately 35 staff will be made redundant. Co-founder of the business, Chris Lee, left the studio earlier this year.
"Over the past three months we have examined a number of options for our studio's future with Activision. Today we are excited to share with our fans and community the news that we will continue our strong partnership with Activision, with work starting on a new, innovative project," commented Jamie Jackson, creative director.
"While we are still in a consultation process with the studio, we cannot release details about the project we will be working on but we look forward to sharing more information in the coming months. We'd like to thank the team, our fans, the media and the video game industry at large for their support during this period."
In February this year Activision said it was mothballing its Guitar and DJ Hero franchises, and laying off a significant portion of staff as it refocused on the Call of Duty and Blizzard businesses.
In March this year FreeStyleGames was given three months notice by the UK's Companies House to prove it was still a trading company or risk being dissolved. A month later, the developer convinced the authorities that it was indeed still a functioning business.
"We envisage that approximately 35 roles will be impacted and are consulting with the studio to offer tools and resources, including outplacement counselling services and career fairs to those employees affected," added David Osbourn, design director.
"Although we will be really sorry to lose members of the FreeStyleGames family we have no doubt that their talents will be in high demand throughout the industry."