If you played Hydrophobia, then this really shouldn’t come to surprise to anyone. After a horrible release on the Xbox, they tried to retool the game in a later version. However, even the updated version was pretty awful. Naturally, the company going under was going to happen.
According to GamesIndustry.Biz “It is also suspected that the company’s assets could be bundled into a ‘pre-packed’ administration deal, with newly formed outfit Dark Energy Publishing, said to be lined up to take control of physical assets and IP at a bargain price.”
Currently the future is up in the air, but if Dark Energy Publishing doesn’t obtain the assets, then we might see someone else stepping up for the amazing water engine used in Hydrophobia.