Despite the shuttering of its current Los Angeles-based office and a significant reduction in its workforce, Mercenaries and The Saboteur series developer Pandemic will live on through a "core team," studio owner Electronic Arts tells Shacknews.

"Pandemic Studios and its franchises will be relocated to the EALA facility in nearby Playa Vista," explained the company. "This move has resulted in a reduction in the work force at Pandemic...That said, the Pandemic brand and franchises will continue to live on. A core team of Pandemic developers will move to EALA and continue development on Pandemic games with a focus on quality, cost management and schedule integrity."

The consolidation is part of Electronic Arts' recently revealed cost reduction plan, which aims to save the company roughly $100 million through "the closure of several facilities and a headcount reduction of approximately 1,500 positions." EA acquired Pandemic alongside Mass Effect developer BioWare for $860 million back in 2007.

The fate of Pandemic's two unannounced projects remains unclear, with the studio's long-coming World War II stealth-action game The Saboteur due on December 8.

Update 2: Studio owner Electronic Arts has chimed in, explaining that "a core team of Pandemic developers will move to EALA" and continue the Pandemic brand.

Update: "It's official, pandemic is shut down as of today," reads a tweet from Pandemic's Drew Marlowe. "Thankfully it looks like we are getting decent severance."

More details, including an official statement, are expected shortly.

Original: Rumours are circulating that Pandemic Studios--the Los Angeles-based developer of the Mercenaries series and The Saboteur--is to be closed as part of EA's $100 million cost-cutting plan, first reported by Kotaku.

The majority of the studio's two hundred-odd staff will reportedly be informed today that the development and publishing giant intends to lay them off.

Further rumours suggest that one Pandemic team may survive the layoffs and join the EA Los Angeles campus--itself rumoured to be facing cuts in the form of the Command & Conquer 4 team. Pandemic's website lists two mystery "current projects."

Pandemic's open-world shooter sequel Mercenaries 2 suffered a lengthy development with several delays, though as of October 2008 it had sold 1.9 million copies and then-EA publishing COO John Pleasants declared "there will be a Mercenaries 3, and if I can have anything to do with it, there will be a Mercenaries 10... Read more

Publisher Activision has hired Dead Space veterans Glen Schofield and Michael Condrey away from EA, with the duo set to lead a new studio in the San Francisco Bay Area that's been tasked with a creating a new game based in an existing Activision franchise.

Schofield had served as executive producer on Dead Space at Visceral Games, formerly known as EA Redwood Shores, and was acting as vice president and general manager of the studio. Condrey, meanwhile, was the studio's COO. The developer's work on Dead Space Extraction and Dante's Inferno is said to be unaffected by the staff changes.

Word of the departures first emerged via GameSpot, with EA and Activision later confirming the news to various sites, including VG247 and IndustryGamers.