With that said, Obsidian's games saw a great deal of success on the original Xbox and the Xbox 360 with a few console exclusives, such as the much-loved KOTOR II: Knights of the Old Republic.
According to sources close to Kotaku, Microsoft is now finalizing a deal to acquire the independent company to gain another first party studio.
Both Obsidian and Microsoft are refusing to comment on the report, citing the usual "refusing to comment on speculation" line, but it is an interesting time given that the team is hard at work on a new RPG with Private Division as the publisher. The studio was saved from closure, however, by the success of its crowdfunded project "Pillars of Eternity" in 2015, which raised almost $4 million. Clearly, this would provide the studio with some stability and heaps of resources from one of the "Big 3".
One source supposedly commented that Microsoft wants to increase development of PC software, making Obsidian a prime candidate for acquisition.
In late 2017, Obsidian announced that it was developing a new RPG that would be published by Private Division, a label of 2K Games created to fund mid-sized games. A series of cancelled projects reportedly led to major financial troubles in 2012. Obsidian, on the other hand, said: "Unfortunately, we don't comment on rumors or speculation other than to say that the Rumors album by Fleetwood Mac still holds up".
A person familiar with goings-on at Microsoft said the company has been looking to bolster its PC development, which makes the PC-focused Obsidian a ideal fit.