Compulsion Games Completes Management Buyout From Xbox, Regains Publishing Rights to South of Midnight, We Happy Few and Contrast

Compulsion Games, the Montreal-based studio behind South of Midnight, We Happy Few and Contrast, has officially completed a management buyout from Xbox and now owns its games and intellectual property again. CEO Guillaume Provost confirmed the deal in an exclusive interview with GamesBeat, calling it "a far better outcome than the alternative, which was shutting down the studio," and telling his team that completing the separation was a question of keeping the group together.

The confirmation ends a process Microsoft kicked off in early July, when it announced it was divesting five game studios as part of a sweeping reorganization that also laid off 3,200 people. Compulsion was one of the five studios being spun out from Microsoft. The first public sign of the buyout came last week, when the Steam version of South of Midnight flipped its publisher from Microsoft back to Compulsion Games, a change Compulsion declined to comment on at the time.

According to Provost, the management buyout has now closed and the studio has bought its original IP back from Microsoft. Provost said management acquired the studio and its staff as well, so any purchase of a Compulsion Games title now supports the studio directly rather than Microsoft. "We're confirming we're getting all of our publishing rights back," Provost said, though he acknowledged the legal work takes time, with Compulsion still having to assume ownership of its games on Switch, PlayStation and Xbox storefronts.

The studio's catalog spans several genres. Contrast (2013) was a puzzle-platformer with unique light-and-shadow mechanics, We Happy Few (2018) was a survival horror game built around first-person exploration, and South of Midnight (2025) was a third-person fantasy action adventure set in a folklore-inspired version of the American South. Provost framed the deal as a team-first decision: "I did this deal for the team first and foremost. I asked the team, 'Do you want to stay together?' The team told me we would rather eat rocks and drink gasoline rather than be split up," he said.

It is only nine days since the deal closed, and Provost said the company is concentrating on one step at a time. He is meeting with various parties to secure a stable future for Compulsion Games in its independent state, exploring different alternatives for permanent funding while the team continues to work. Part of the team is busy on a title that was already in progress when Microsoft decided to change course under its new leader, Asha Sharma.

Compulsion Games has now updated its public presence to match its new status, with its profile describing the studio as an "Independent video game developer and makers of the games South of Midnight, We Happy Few, and Contrast." Reporting on the buyout has been confirmed across multiple outlets, including GamesBeat's exclusive, Video Games Chronicle, IGN, GamesIndustry.biz, Insider Gaming and VGChartz, all citing Provost's comments.