UTV buys Indiagames, Ignition Entertainment for Rs 1.28 billion

MUMBAI: UTV Software Communications Ltd. is making a foray into gaming by acquiring controlling stakes in UK-based Ignition Entertainment and Indiagames for a total for Rs 1.28 billion.

While UTV will pay Indiagames, a mobile and broadband gaming company, Rs 680 million, the acquisition of 70 per cent in Ignition Entertainment will cost Rs 600 million. Ignition Entertainment is a console gaming company with an annual revenue of around $15 million.

"We presently create, develop and aggregate content for TV, movies and animation. With an objective to create content across all entertainment platforms, the company has ventured into gaming. This will give us exposure to the rapidly growing mobile, PC and console gaming industry," UTV said in a release.

Indiagames CEO and founder Vishal Gondal will continue to head the company and evolve synergies with other UTV businesses in the creation of cutting-edge games. The company reported annual revenues of around $5 million for the last fiscal and has an employee strength of 270 people. "Post transaction the shareholders of the company will include Cisco Systems, Adobe Inc. and Management. IG is presently involved with mobile game development, publishing and distribution across 67 countries through 80 telecom partners like Vodafone, Verizon, Hutch and Airtel. Its latest venture into PC games distributed online through broadband ISPs like BSNL, MTNL, Airtel and Tata VSNL amongst others is expected to be a major value driver," the release said.

The acquisition of Ignition Entertainment will bring to the table relationships with hardware manufacturers, game developers and distributors such as Sony, Nintendo, Microsoft, SNK, Konami, Atari, Virgin and Wal Mart. "Ignition is presently developing a top end game 'WarDevil' budgeted at around 10 million pounds and is expected to release it in the year 2008 exclusively on the Sony Playstation3(tm) (PS3) platform. PS3 was launched in November 2006 in Japan and the US and it is expected to sell more than 30 million units by the end of 2008," UTV said.

UTV plans to invest Rs 1.35 billion in the development of animation movies over the next three years. "Simi Nallaseth, one of the key animators of the international smash-hit animation movie Ice Age is developing one of the productions. Arnab Chaudhury, former Head of Channel [V] and Creative Director of Turner International (Asia), will be working on another project. We are now in the scripting stage of our CG animation production with Will Smith's Overbrook," UTV said.

UTV's scrip, however, fell 4.83 per cent on the BSE, closing the day at Rs 263.95.

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