Second studio liquidated in Nacon collapse: Midgar's 18-year run ends without a buyer

A French court ordered the liquidation of Midgar Studio on July 20, 2026, ending the Montpellier-area developer's 18-year run and almost certainly ending Edge of Memories, the action RPG the studio had been building toward a late-2026 release. No buyer was found before the court's deadline. It is the second permanent studio closure to fall from Nacon's ongoing financial meltdown — and it arrived despite the team working, in founder Jérémy Zeler-Maury's words, "until the very end" to find a way out, as Game Developer reported.

One Bond Default, Five Studios

The collapse that ended Midgar Studio began not in Montpellier but in the offices of Bigben Interactive, Nacon's majority shareholder, which holds 56.72% of Nacon's share capital and 65.79% of its voting rights, according to Bigben's official February 25, 2026 press release. On February 13, 2026, with four business days remaining before the maturity date on an existing €87.3 million bond, Bigben's banking pool refused to honor a drawdown notice under a new €43 million refinancing credit facility. The banks claimed a contractual information disclosure obligation had been breached; Bigben disputes that legal interpretation and says the refusal was "unexpected."

The practical consequence was immediate: Bigben could not make its bond repayment. Twelve days later, on February 25, Nacon filed for insolvency with the Lille Métropole Commercial Court and requested the opening of judicial reorganization proceedings — a French legal process known as redressement judiciaire that freezes existing debts for up to 18 months while a company tries to draft a recovery plan. Nacon publicly committed to protecting employees and ensuring its announced game slate would reach players.

The commitment proved difficult to keep. On March 23, four Nacon subsidiaries — Spiders, the Paris-based RPG studio behind the GreedFall franchise; Kylotonn, the racing specialist behind Test Drive Unlimited: Solar Crown and the WRC series; Cyanide, developer of the Styx games and Blood Bowl titles; and motion-capture company Nacon Tech — each filed individually for judicial reorganization proceedings. The four studios collectively employed more than 320 developers, according to French gaming journalist Gauthier "Gautoz" Andres, who broke the story.

The timing added a layer of grim irony. Spiders had shipped the full 1.0 release of GreedFall: The Dying World on March 10 — just 13 days before its insolvency filing. Cyanide's Styx: Blades of Greed had launched on February 19, six days before Nacon's own filing. These studios had been completing and releasing games right up until the floor gave way.

Spiders Falls First

Spiders was the first to be liquidated. After a sale process failed — no buyer materialized before a mid-April 2026 deadline — the Paris studio confirmed on April 29 that a court had ordered its liquidation. "The company as a whole no longer exists," the studio said in a social media post. Approximately 75 employees were immediately laid off. Spiders had been operating for 18 years when it closed — the same age as Midgar.

One positive signal emerged in early July: British strategy publisher Slitherine Software acquired the Blood Bowl video game franchise — including its license, publishing rights, and back catalog — from Nacon on July 1, retaining Cyanide as the developer for the ongoing series and an upcoming Warhammer Blood Bowl title. The deal was the first major intellectual property extracted from Nacon's holdings since the insolvency filings began, and Cyanide CEO Patrick Pligersdorffer confirmed the team would continue under Slitherine's publishing umbrella.

The Blood Bowl deal aside, the broader picture remained stark. The Nacon group had gone from being the second-largest employer in French video game development to a publisher in court-supervised restructuring, with two of its longest-running creative studios permanently closed.

Midgar's Final Weeks

Midgar Studio was not among the initial March wave. The developer occupied an unusual position: it was still actively demoing Edge of Memories at the rescheduled Nacon Connect showcase in late May 2026, presenting the action RPG to press even as the legal proceedings surrounding its parent company were deepening. In late May 2026, Midgar filed its own declaration of insolvency and requested judicial reorganization proceedings.

A sale process began immediately. For several weeks, Nacon's administrators sought a buyer who could absorb Midgar, preserve its team, and potentially carry Edge of Memories across the finish line. The game had attracted attention for its action RPG design with talent attached from the Nier Automata, Xenoblade Chronicles, and Chrono Trigger creative lineages, and was planned for release on PlayStation 5, Xbox Series X|S, and PC.

No agreement could be reached before the court's deadline.

"Over the past few weeks, we worked until the very end to find a solution that could preserve both the company and the team," Zeler-Maury wrote in his LinkedIn statement on July 20. "Despite every avenue explored and everyone who tried to help us, no solution could be completed within the timeframe of the process. Unfortunately, the court has now ordered the liquidation of Midgar Studio."

Nacon has not issued a formal statement on the status of Edge of Memories. A cancellation is the widely expected outcome.

What Debt-Fueled Acquisition Actually Costs

The Nacon collapse is not simply a story of financial mismanagement, though the French game workers' union — the Syndicat des Travailleureuses du Jeu Vidéo — used exactly that framing, issuing a March 2026 statement characterizing the crisis as the product of Nacon management's "disdain for video game production and their incompetence." It is also a structural proof-of-concept that the debt-financed studio acquisition model — fashionable throughout the late 2010s and early 2020s when cheap credit made buying studios feel low-risk — is fundamentally incompatible with the financial realities of game development.

The mechanism is straightforward. A studio acquired with borrowed money has no independent capitalization — it cannot raise its own funding, it has no buffer against the parent company's financial position, and its commercial output (game sales) is rarely sufficient to service the acquisition debt on its own. When the acquired studios also ship games to mixed reception — GreedFall: The Dying World received a Metacritic score of 63 on PC and an OpenCritic recommendation rate of 17%; Test Drive Unlimited: Solar Crown and Blood Bowl 3 were both commercially underwhelming — the revenue available to service parent-company debt shrinks further.

A single contractual dispute at the banking level — the banks' refusal of Bigben's drawdown notice over an alleged information disclosure breach — was sufficient to trigger the collapse of an entire network of studios, none of which had the financial independence to survive without the parent.

Nacon is not an isolated case. The games industry has watched similar cascades at Embracer Group — which underwent sweeping studio closures beginning in 2023 after a major investment deal collapsed — and at multiple publishers that expanded aggressively on cheap debt and then found the resulting overhead impossible to sustain when market conditions tightened. The core dynamic is always the same: studios that were acquired as assets cannot function as independent businesses when the holding structure fails.

For developers, the implication is not abstract. A studio that was releasing its latest game six days before its parent filed for insolvency — as Cyanide did — has no practical way to protect itself from that upstream shock. The talent, the IP in development, and years of accumulated institutional knowledge can all be destroyed by a contractual dispute in a credit agreement the studio's developers never saw and had no influence over.

Did Any Part of Nacon Survive?

The short answer, as of July 21, 2026: some IP has found new homes; most studios remain in limbo.

Cyanide is operating under Slitherine's publishing relationship for Blood Bowl and continues its development work. Kylotonn's status is uncertain: the racing studio had a significant deal in place to regain the WRC video game license from 2027 onward — a contract that was announced before the insolvency filings — and its fate is entangled with how Nacon's administrators handle the remaining proceedings. No buyer for Kylotonn has been publicly confirmed.

The remaining Nacon group is still under court-supervised reorganization. Nacon demonstrated it could carry existing commitments through the crisis — the co-op horror title The Mound: Omen of Cthulhu, from Chilean developer ACE Team, launched on July 15 as planned — but two of its longest-serving internal development studios are now gone permanently.

An 18-Year Chapter Closes

Zeler-Maury founded Midgar Studio in 2008, naming it after the iconic city in Final Fantasy VII. The studio's first major commercial title, the open-world parkour game Hover, arrived in 2017. Its turn-based JRPG Edge of Eternity launched in 2021 after a crowdfunded early access period and attracted a dedicated niche following. Nacon acquired the studio in February 2022. Three games. Eighteen years. One unfinished fourth.

"I founded Midgar in 2008, driven by the desire to create games that felt like us, at the crossroads of French and Japanese sensibilities," Zeler-Maury wrote in his statement. "Midgar is the work we accomplished on Hover, Edge of Eternity, Edge of Memories, and all the projects, prototypes, ideas and worlds that passed through the studio. But above all, Midgar is the people who brought our games to life, and everyone who contributed to this journey."

He closed his statement with an appeal to the industry: "To the studios, publishers and recruiters reading this: this team deserves your attention. Please reach out to them."

Frequently Asked Questions

What happens to Edge of Memories now that Midgar Studio has been liquidated?

Nacon has not issued an official statement on the game's fate. The game was planned for release on PlayStation 5, Xbox Series X|S, and PC later in 2026. When Spiders was liquidated in April, Nacon retained the rights to publish planned DLC for GreedFall: The Dying World — so a similar arrangement is theoretically possible for Edge of Memories. In practice, completing an unfinished game without its development studio requires contracting a new team, and Nacon remains under court-supervised insolvency proceedings with limited resources. Most observers consider cancellation the likely outcome, but it has not been confirmed.

Why did Nacon collapse in the first place?

The immediate trigger was a single financing refusal. On February 13, 2026, the banking pool behind a €43 million refinancing credit facility refused to honor Bigben Interactive's drawdown notice on the grounds of an alleged contractual information disclosure breach — four days before the €87.3 million bond's maturity date. Bigben disputes this legal interpretation. The underlying causes were structural: an aggressive studio acquisition strategy funded by debt, combined with a string of commercially underperforming releases, left the company with insufficient revenue to absorb any financial shock. The French game workers' union publicly attributed the crisis to what it characterized as management's "disdain for video game production and their incompetence," and a total absence of long-term strategy for the studios in its portfolio.

Are any of Nacon's other studios still operating?

Cyanide continues development under a new publishing relationship with Slitherine Software, which acquired the Blood Bowl franchise license from Nacon on July 1, 2026. Kylotonn's status remains uncertain — the studio was developing under a deal to reclaim the WRC racing license from 2027 onward, but no buyer has been publicly confirmed. Nacon itself remains under court-supervised judicial reorganization proceedings. The outcome for individual studios depends on whether buyers emerge or whether Nacon's administrators can construct a viable restructuring plan.

Does this pattern affect game players directly?

Yes, in several ways. Players who anticipated Edge of Memories face its likely cancellation. Games from closed studios — including the GreedFall series and the complete Styx and Hover catalogs — have no active development studio, making future patches, ports, or DLC dependent entirely on Nacon or any successor rights holder. More broadly, the Nacon collapse illustrates a risk that consumer interest in a mid-tier game is no protection against a publisher's financial collapse — a game can be in active development and featured at a major showcase one week, and its studio can be under liquidation orders the next.