Representatives from Sega Sammy have announced that the merged company is to close its Korean subsidiary office as a part of “global business optimization”.

As in Japan, the subsidiary oversees the publishing and distribution of home video game titles, coin-operated machine sales and the operation of numerous amusement facilities.

At the same time, the company has canceled plans to build a ¥33 billion ($330m) arcade complex in Yokohama, near Tokyo. According to Bloomberg the company had planned to acquire 10 acres for the site, and has already spent ¥22.6 billion ($227m) to buy some of the required land.

Although Sega’s home console business remains healthy, Sammy’s core pachinko and amusement center business has fallen victim to a general malaise in the market in recent months, with Sega Sammy forecasting a loss for the full year and revealing plans for 400 job cuts across the company.

At the time, the company indicated the cutback were necessary "due to Sega failing to respond to changing business environment”. This led to new rumors that Sega would be sold off or merged with another competitor – although this was later denied by U.S. CEO Simon Jeffrey.