SEGA Racing Studio closes

The relatively new studio was not expected to make a decent return for the SEGA business.

SEGA has confirmed to Next-Gen that SEGA Racing Studio has closed, the publisher citing a lack of profitability for the decision.

The news of the studio's closure was first reported by trade website Develop and was later confirmed by SEGA to Next-Gen.

"Regrettably Sega today announced that it is to commence consultation regarding the unfortunate closure of the Sega Racing Studio in Birmingham, UK," the company stated.

"The decision is part of a review of Sega's Western Development Studios to ensure that each studio is a profitable entity in its own right, and unfortunately the Sega Racing Studio's 5 year plan would not result in a successful return for the Sega business moving forward. Sega would like to stress that there will be no changes within their other internal development studios."

The Birmingham-based studio was founded in 2005 and its only output was the 2007 arcade racer SEGA Rally.