Dark Energy Digital, the developer behind Hydrophobia and its revamped re-release Hydrophobia Prophecy, is reportedly closing down. The company's assets may be bundled and sold to the newly formed Dark Energy Publishing, formed in January by original studio owners Pete and Deborah Jones, along with technical director Gary Leach.

GamesIndustry.biz reports that administrators Leonard Curtis moved in on Friday, March 16. The state of staff wages during the administrative process is unknown.

The studio has been in danger of closing since Hydrophobia performed poorly. The company attempted to fix common complaints through a sizable Pure patch; the later-released Hydrophobia Prophecy incorporated even more features. Unfortunately, even with the changes, the game received mixed reviews. The highlight of the game appears to be the impressive water physics--which is sure to be a key asset up for grabs.