Starbreeze’s headquarters have been raided by police following reports of insider trading, leading to at least one arrest and the seizure of equipment, including computers and documents.
Talking to Expressen, Starbreeze’s investor relations chief, Ann Charlotte Svensson, said: "The company as such is not the subject of any suspicion. The company cooperates with the ECO [Economic Crime Authority]. The event does not affect the company of the ongoing business reconstruction."
"On Wednesday Swedish Economic Crime Authority has conducted a search query at Starbreeze AB," Starbreeze said in a full statement to GIBiz (via VG24/7). "The company has been informed that this has occurred due to suspicions of insider charges. The company as such is not subject to any suspicion. The company cooperates full [sic] with the Swedish Economic Crime Authority. The event does not affect the company or the ongoing business reconstruction. Starbreeze has no further information on the matter."
ECO press officer Niklas Ahlgren also issued the following statement: "This morning officials from the Swedish Economic Crime Authority raided the offices of Starbreeze in Stockholm. One person was arrested and items were seized. The raid is part of an ongoing investigation involving suspected insider trading."
After the "disappointing" launch of Overkill’s The Walking Dead, Starbreeze’s board of directors announced it was reviewing operations costs and implementing a program "to reduce costs and sharpen focus on core business". The plan initiated a cost-cutting program, which included scaling back both internal and external development and was expected "to generate significant cost savings during the full year 2019 compared to 2018".
The developer confirmed initial sales revenues from Overkill’s The Walking Dead were "lower than forecasted", but attributed the revenue issues to "the share of sales in low-price countries, such as China and Russia, [being] significantly higher than expected".
"This is disappointing, of course, but we have a base to work with in regards to the number of games sold," Starbreeze chairman Michael Hjorth said at the time. "We have a pulse of concurrent players, which is essential to future performance within the framework of our Games as a Service concept. The team is working at full capacity to deliver improvements to the game and new content, and Season 2 will be starting soon."
Consequently, on Monday Starbreeze filed for reconstruction with the Stockholm District Court following a "shortage of liquidity" that requires the company to "negotiate a long-term financial solution".