Trouble at CDV as UK office faces closure

The UK division of German publisher CDV is likely to close its doors at the end of the summer, as rumours circulate that tough restructuring measures undertaken by the company may not be enough to rescue it.

Sources within the company have indicated that it may have as little as four to six weeks to come up with a definite recovery plan or face closure - with significant layoffs already made at the German head office of the group.

The UK division of CDV is another casualty of the current difficulties, with the company officially confirming that the UK office in London is likely to close its doors at the end of summer. A number of staff from this office are already thought to have been laid off.

"I'm very proud of what we've achieved at CDV in the UK," CDV UK president Terry Malham told gi.biz. "We've grown from a standing start to being the most profitable of CDV's international divisions."

However, the success of the UK division can't rescue it from the disastrous financial results revealed a few weeks ago by the parent company, which showed a four million Euro deficit in the second quarter. At the time, CDV admitted that "rigorous restructuring" would be needed; it seems now that these measures may not have been sufficient.

Despite the closure of CDV UK, the release of highly anticipated UK-developed first person shooter Breed in autumn is expected to continue as planned, with the title being handled by CDV Germany and distributed by Gauntlet. The company is also still planning to release its first Xbox titles in the first quarter of 2004.