Sproing Interactive is restructuring UPDATE: Austria's largest games developer says it is not entirely insolvent or closed, laying off two teams after project cancellation

James Batchelor UK Editor Monday 28th November 2016 Share this article Share

Companies in this article Sproing

Update: CEO Harald Riegler has denied reports that his studio Sproing Interactive has entered insolvency, instead claiming the developer is using "a formal restructuring process" to lay off two of its five teams.

The restructure follows the cancellation of a big project, with the goal of allowing Sproing to continue operating as a smaller studio. While a number of employees have been laid off, Riegler stresses that those remaining are working on "profitable projects".

"This step is very sad, and we're terrible sorry for those affected, but it doesn't jeopardise the studio per se," he told GamesIndustry.biz. "We sincerely wish those affected the best of luck and are actively helping them to secure more work. At Sproing, we are now focusing on the future as a smaller, more focused team."

Riegler also denied reports the studio owes staff millions of euros, adding: "All employees affected have been paid all salaries, and they will also receive everything they are owed during the layoffs".

Update 2: Sproing has reached out against with further clarification on the situation. Under Austrian law, firms that file for 'Insolvenz' are entirely insolvent. However, Sproing has filed for 'Sanierung', a special form of insolvency that allows for rehabilitation and restructuring. The key difference when compared with most market is that the company continues to operate normally and is able to close any unprofitable parts of the business. In the case of Sproing, cutting two of its five development teams. Riegler confirmed Sproing does owe creditors money, but clarified again that all employees have been paid.

Original story: Reports suggest that Sproing Interactive is now insolvent, with liabilities amounting to around €2.8 million and approximately 35 creditors affected.

News of the studio's plight has emerged from numerous Austrian news sites, including Der Standard, which reports that creditor protection associations AKV Europa and KSV 1870 are already handling the company's debts and helping the developer's 100 employees find new roles elsewhere - around two thirds of the firm's workforce.

Vienna-based Sproing was founded in 2001 and is best known for free-to-play titles such as Asterix and Friends, which was published in the UK and other territories by Namco Bandai earlier this year after a lengthy soft launch as well as tie-ins to popular German game show Schlag den Raab.

€1.5m of the firm's debts are reportedly owed to banks and other creditors. A reorganisation plan has been drawn up that offers creditors a rate of 20 per cent, payable within two years. The rest centres around employee claims. A statement from the CEO Harald Riegler indicates that much of the staff are either already in talks with other "well-known studios" or branching out and forming their own development firms.

Sproing's troubles are said to be due to a failed project the company had invested heavily in and the loss of a major contract. The insolvency is apparently specific to Sproing Interactive, the firm's development arm and Austria's largest games developer. Sproing Publishing is reportedly not affected by the changes.

In a statement to Der Standard, the firm said: "A total of two development teams will be dismantled. The employees in the other teams will be retained by the company and will continue to work on the current projects."

Similar reports appear on Games Wirtschaft, Die Presse and Golem. GamesIndustry.biz has reached out to the studio for comment, but things are looking noticeably quiet over there. Sproing's Twitter account hasn't been updated since November 8th, while the most recent Facebook post was November 21st.

We'll report back with an update as soon as we know more.

If you have jobs news to share or a new hire you want to shout about, please contact us on newhires@gamesindustry.biz