IG Port, the parent company of several anime studios including Production I.G and WIT Studio, announced that its board of directors decided on Tuesday to transfer the production operations of one of its consolidated subsidiaries, the anime studio Xebec, to Sunrise.

Sunrise added that it plans to establish a new subsidiary to take in Xebec's production operations on March 1, 2019. Sunrise, IG Port, and Xebec will agree to these terms under a letter of intent between the three companies on Wednesday. The companies plan to sign the finalized agreement on March 11, and formally transfer the operations on April 1 (the start of the Japanese fiscal year).

IG Port explained that Xebec's primary business — production for animation and other onscreen works — has been running a deficit for a long time, while revenues from its licensing business has not made up for the shortfall. While it was running a deficit, Xebec implemented measures to improve its bottom line, such as stabilizing its revenue stream by accepting production work contracts for long series, reviewing its management structure, and moving its headquarters.

However, even though it had the capacity to produce popular works, Xebec's financial results within IG Port's group companies did not improve. So, IG Port considered ways to move forward including reorganizing its group companies.

Xebec has been in operation since its founding in May 1995. Its many works include Space Battleship Yamato 2199, Star Blazers: Space Battleship Yamato 2202, Martian Successor Nadesico, Hana Kappa, and Future Card Buddyfight. Its current president is Nobuyoshi Habara.

Sunrise was founded over 40 years ago in 1972 as Sunrise Studio, before renaming itself as Nippon Sunrise and eventually just Sunrise. It is now a group company of Bandai Namco Holdings. Its many works include Mobile Suit Gundam, Code Geass, Love Live!, and Cowboy Bebop. Its current president is Yasuo Miyakawa.

Sources: IG Port's press release, Sunrise's press release via Otakomu