Explain to me what makes sense about keeping a Japanese studio, located in Japan, AFTER all the key veteran Japanese devs left? Likely no projects beyond concept art and design documents. All Indians, no Chiefs. What's even left worth salvaging? The writing was on the wall for Tango prior to Hi-Fi Rush's release, and when Mikami left and took his Capcom cronies with him was the day Microsoft started chiseling that tombstone. Hi-Fi Rush tanking on every platform under the sun surely couldn't have helped that already dire situation for the remnants of greenhorn staff that was left.
Like it or not, this was likely done to make room for acquiring another Japanese studio that is already fully staffed up and has buns in the oven. My money would be on Platinum. And before anyone rushes to their defense, lest we forget they quite publicly asked Microsoft to come over and fuck them recently, after all.