It’s been revealed that Midway are to close their Austin offices, reduce staff by 25% and halt development on current projects.

The frozen projects in question are games that have not yet been announced, with projected release dates during 2010 and 2011, and are considered by Midway to be “non-core” projects. The closure of Midway’s offices in Austin, which housed Midway’s Central Outsourcing Group, encompasses some of the projects that are now indefinitely suspended. Projects that are known to remain in development include The Wheelman, This is Vegas and a TNA Wrestling franchise game.

The 25% reduction in workforce (roughly 180 employees laid off), however, affects Midway’s operations in Chicago and San Diego in the US, as well as the Austin office. $1.6 million in severance is expected to be paid out to redundant employees. President and CEO of Midway, Matt Booty said regarding the announcements:

“The cost-reduction measures are vital for us to rationalise our operations and provide the resources necessary for our core properties to succeed. These initiatives, along with the other steps we have taken this year, are a response to the specific challenges we are facing at Midway, many of which have been amplified by the current economic conditions.”

This news arrives on the back of an extremely unfortunate year for Midway, as a majority of the company was sold by stakeholder Sumner Redstone for a mere $100 000, while Midway also face a delisting on the stock exchange and the possibility of bankruptcy if several large loans are not repaid in the next month.