Yager's fine. It's just the Dead Island 2 bit that's shut down

You've probably seen some 'Dead Island 2 studio bankrupt' headlines and tweets floating around but that's not strictly true. What's actually happened is that 'Yager Productions GMBH', a separate studio set up specifically to work on the zombie game, has filed for insolvency following its surprise drop from Dead Island 2 development.

Here's the statement managing director Timo Ullmann issued to GamesIndustry.biz :

"As single-purpose company, Yager Productions GmbH was assigned to the development of the Deep Silver title Dead Island 2. The insolvency filing is a direct result from the early termination of the project and helps protecting our staff. In the course of the proceedings, we gain time to sort out the best options for reorganizing this entity".

So, Yager itself isn't going bankrupt, and Yager Productions GMBH isn't necessarily gone, this is just the paperwork required to keep things safe while the studio works out what to do with the resources now it's not got Dead Island 2 money to pay for everything. According to Timo, the main studio's unaffected and everyone's wages are safe for the time being.

Deep Silver and Yager split ways earlier in the month, with Yager claiming it was because "respective visions of the project fell out of alignment". Deep Silver on the other hand said it had "always been dedicated to delivering the sequel that Dead Island fans deserve [and] after careful consideration we announce the decision to part ways with development partner Yager".

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