Rumor: Lionhead Was Closed Because Microsoft Wouldn't Sell Fable

Rumours are claiming Microsoft turned down "several potential buyers" for Lionhead Studios before it was closed down last month.

Kotaku UK claims multiple sources told the website that "some of the biggest names in video game publishing" wrote letters of intent (the documents used to signal a serious desire to purchase a company) regarding acquiring the now-shuttered game studio.

According to one source, the complication came when it came to IP - Microsoft would not sell the rights to the Fable series along with the developer that created it. The source said: "90% of the people interested just walked away at that point," despite bids of hundreds of millions of pounds.

As Kotaku UK points out, without the Fable license, Lionhead making a Fable-branded game would require a new publisher to reach a licensing agreement with Microsoft, costing them a portion of the project's revenue.

Microsoft's desire to keep hold of the Fable IP could signal a desire to have a new game in the franchise made by another studio, but it's as likely that Microsoft simply doesn't want a direct competitor profiting after a sale.

It's been a tough year for British developers so far. Alongside Lionhead's closure, Guitar Hero Live developer, FreeStyle Games has suffered layoffs, and DriveClub studio Evolution was closed by Sony, before being absorbed as a new studio by CodeMasters.

Source: IGN