According to undisclosed sources reported by Kotaku, the acquisition of Obsidian Entertainment by Microsoft is in the final stages of negotiation, in fact about "90%" as per one of the sources. Another source claims that "it's a matter of when, not if." The rumor first started back in August this year, when Resetera user Klobrille submitted the following post: "Obsidian Entertainment letter-of-intent for an acquisition by MS. Dated before E3. No written sign of a MS employee (only Obsidian). I'm not as sure on this one as I was with the Playground Games LOI I got access to earlier this year. That's all I have right now. Hope that's transparent enough for you guys. I can't validate it any further, I'm sorry."

Back in July 2016, in an interview with Gamesindustry.biz, CEO Feargus Urquhart said: "We just want to be in a financial situation where we're not worried all the time." Obsidian had been going through dire straits for quite some time in the early 2010s, in between various canceled projects such as a Snow White game commissioned by Disney, and the ill-fated Stormlands, which was to be published by Microsoft as an Xbox One launch title. Last year the CEO also said that Stormlands was canceled because Obsidian "didn't have an advocate [at Microsoft]."

Microsoft has acquired quite a selection of independent studios in the past year. At this year's E3 Phil Spencer talked about the importance of exclusive titles and announced a new Microsoft studio, The Initiative, and several acquisitions, such as Undead Labs (State of Decay), Playground Games (Forza Horizon), Ninja Theory (Hellblade: Senua's Sacrifice), and Compulsion Games (We Happy Few). A few of these studios had already previously worked with Microsoft as a publisher. Obsidian Entertainment would be a great addition to this supergroup of acquisitions.

In June this year, Obsidian had its 15th anniversary, which we celebrated with a special feature. Whether the rumors of an acquisition by Microsoft are true or not, Obsidian was already in negotiations with Take-Two Interactive to publish an unannounced RPG currently in development by Fallout creators Tim Cain and Leonard Boyarsky, as reported last year by GameInformer. Although the talk of Xbox One exclusives could be worrisome to some Obsidian fans, as a studio that was actually founded with the intent to develop games for both PC and consoles, it might be an unfounded concern. Considering Microsoft's amicable dealings with the other studios they acquired, such as We Happy Few's release not getting in the way of the arrangement with Gearbox Software, and Hellblade getting a late physical retail PlayStation 4 release published by 505 Games, a Microsoft-owned Obsidian could finally attain the stability required for their complex and reactive RPGs.

We are reaching out to the involved parties and will update the article if more information becomes available.

Update 10/13/2018

The same user who started the rumor on Resetera has published the following on Twitter:

https://twitter.com/klobrille/status/1050655990385790976

It's noteworthy that Klobrille describes it as "a proper two-team studio," considering the allegations made by Chris Avellone back in May, that Obsidian had been practicing cost padding, with funds intended for Tyranny being used for the development of Pillars of Eternity.

Both Microsoft and Obsidian had no comment on the rumor.

Do you think these rumors are true? What kind of games would you expect from Obsidian if they are owned by Microsoft? Let us know in the comments below.