Mobile social gaming company Gree is closing its Chinese operation, as part of a plan to optimise its operations through “a process of selection and concentration”.

The company confirmed the move in a statement to The Next Web, noting that it “regrets we have had to make this closure and wish all the best to everyone affected”.

According to the Wall Street Journal, the move will impact 140 staff, and comes after  two years of operations in the country.

It was said that while China is widely recognised as a major opportunity for developers, local rules – such as the need to hold a licence to operate paid internet services – pose challenges.

As a result, Gree’s facility in the country has been operating as a development centre for its global operation, rather than spearheading its efforts in the country.

The company this week announced an extraordinary loss of JPY4 billion ($39.2 million), as a one-time write-off of assets related to certain titles as it looked to “streamline our portfolio of core titles”.

It has also warned of “restructuring costs related to our selection and concentration strategy” – which will presumably include the China closure.

It has also revised its sales guidance for the year to 30 June 2013 downward by between 6.3 per cent and 11.8 per cent, and cut its profit forecast by between 22.6 per cent and 35.1 per cent.

It noted that “Gree’s social games in Japan are not expected to generate sales in line with our previous forecast”.