Mr Wallace, who was at Bizarre for 11 years and rose to become development director, said: “People were aware there were going to be cuts. But the closure of the studio just wasn’t expected at all. Most people didn’t want to move away from the area, even though they’re well-placed to go and work in Seattle or Canada.”

Lucid’s commercial director, Andy Davidson, said he believed the company would soon be well-placed to employ more ex-Bizarre staff, who might otherwise leave the region.

He said: “We know people are being targeted by headhunters and being asked about moving, particularly to Canada.

“We want to get back to the levels of innovation and creativity at Bizarre that made Activision so keen to acquire it.”

Lucid’s managers say they are close to securing contracts that will allow them to grow the business. They will also be at the annual Game Development Conference in San Francisco next week.

Steve Smith, digital industry director at regeneration agency Liverpool Vision, said: “We are keen to keep what is some of the best games talent in the global games market in Liverpool, and from day one we have been very supportive of this initiative.”