There had been rumours to suggest it, but it has now officially been confirmed. Microsoft has sent out an announcement that Bungie Studios, the developers of the Halo franchise, are to "embark on a path to become an independent company".

Microsoft will keep an equity interest in Bungie continuing its long standing publishing agreement for the Microsoft owned "Halo" intellectual property as well as other future properties developed by Bungie.

"Our collaboration with Bungie has resulted in 'Halo' becoming an enduring mainstream hit", said Shane Kim, corporate vice president of Microsoft Game Studios.

"While we are supporting Bungie's desire to return to its independent roots, we will continue to invest in our 'Halo' entertainment property with Bungie and other partners, such as Peter Jackson, on a new interactive series set in the 'Halo' universe."

"We look forward to great success with Bungie as our long-term relationship continues to evolve through 'Halo'-related titles and new IP created by Bungie."

"This exciting evolution of our relationship with Microsoft will enable us to expand both creatively and organizationally in our mission to create world-class games", said Harold Ryan, studio head for Bungie.

"We will continue to develop with our primary focus on Microsoft's platforms; we greatly value our mutually prosperous relationship with our publisher, Microsoft Game Studios, and we look forward to continuing that affiliation through 'Halo' and beyond."