Report: Kerbal Space Program 2 developer out of business because of strife with publisher

Earlier this year, development of Kerbal Space Program 2 shifted from Star Theory to an internal studio at Take-Two Interactive. This was followed by news that the game was being delayed until Fall 2021. Now, it appears that many of the developers at Star Theory are continuing to work on Kerbal Space Program 2 — but it's not exactly straightforward.

According to a report from Jason Schreier at Bloomberg, this wasn't as simple as the game's development just changing hands. In December 2019, Star Theory employees reportedly received emails from an executive at Private Division, a subsidiary of Take-Two, explaining that development of Kerbal Space Program 2 was being pulled from Star Theory and that "To that end, we encourage you to apply for a position with us."

Star Theory's founders had been in talks to sell the studio to Take-Two but were unhappy with the offered terms. As a result, Take-Two's action could be seen as attempting to acquire the studio without even purchasing it.

This email was reportedly met with shock from many employees, who had never seen this kind of situation before. Over the next few weeks, around a dozen of the 30 developers at Star Theory were hired by Take-Two and are now working at Intercept Games, the new studio developing Kerbal Space Program 2. Star Theory has since closed as of March 4, unable to find a new deal with any publishers.