Reports have surfaced that the studio behind the Disgaea series of RPGs, Nippon Ichi Software, is in some serious financial trouble. The company has been struggling for quite some time due to poor sales in the Japanese market, and have delayed their upcoming mobile title Disgaea RPG.
According to those reports, Nippon Ichi is in so much trouble, the company can’t even afford to pay its employees.
The news hit on several Japanese news sites, and was picked up by RPG Site senior staff writer and Twitter user HDKirin who summarized the reports:
News of Disgaea RPG (smartphone game that's now delayed indefinitely) has resurfaced in a bad way.
Reports starting to come out that NIS is not able to pay the salaries of its employees & have resorted to a MS (Moving Strike) Warrant as a last resort. https://t.co/ICVtR95bnY pic.twitter.com/CIig3Zy2Se
— HDKirin (@HDKirin) May 18, 2019
In order to raise enough money to cover their employee’s wages, Nippon Ichi has resorted to a Moving Strike Warrant, which is a way of raising funds while unable to borrow money from banks or investors. With an MS Warrant, the company raises money by selling their stocks on the cheap, which benefits securities firms that buy the cheaper stocks. Unfortunately, it also means that the company’s investors lose the most as the stock rating declines.
Which is to say, an MS Warrant is a desperation moves.
As DualShockers reports:
Japanese site Ha-Navi confirms that Disgaea RPG is the main cause for this last decline that resulted in the company unable to pay wages. On March 19th of this year, the title — a collaboration effort between NIS and Forward Works (a subsidiary of Sony) — began service.
However, since that launch the game had to undergo long-term maintenance due to its many and major issues and was taken down. Service has not been restored as of this writing. Naturally, as revenue cannot be gained from a game no longer available on the market, the company has no way to recoup their losses and pay the staff’s salaries.
The Forward Works official blog released a statement on the issue, apologizing to players for the ongoing issue. The official Twitter account also released a status update, encouraging players who purchased paid items by March 31st to submit their inquiry to a support email account. Considering this tweet came out on May 17th, a full two months after the game launched and shut down, it seems all parties involved are reluctant to refund the money.