Warner Bros and MGM invest in social-gaming company Kabam

SAN FRANCISCO Tue Dec 11, 2012 7:09pm IST

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SAN FRANCISCO (Reuters) - Warner Bros Entertainment Inc and MGM Studios Inc have joined forces to invest an undisclosed amount in the privately-held, social and mobile gaming company, Kabam Inc, the games maker said on Tuesday.

San Francisco-based Kabam, which is known for its popular "Kingdoms of Camelot" strategy games that allow players to build castles and battle troops in a medieval setting, competes with gaming companies like Zynga Inc (ZNGA.O) and Kixeye.

Founded in 2006, Kabam focuses on "mid-core" games, which are immersive games that sit between slickly produced titles like Activision Blizzard Inc's (ATVI.O) "Call of Duty" and casual games like Zynga's bread-and-butter "FarmVille."

Kevin Tsujihara, president of Warner Bros. Home Entertainment will join Kabam's board of directors as a member and MGM's CEO and chairman Gary Barber will join as an observer on the board, the games company said.

Time Warner Inc (TWX.N), the parent of Warner Bros, has previously made investments in game studios like CrowdStar and Trion Worlds through its investment fund called Time Warner Investments.

MGM Studios, which emerged from bankruptcy last year after signing a distribution deal for two James Bond films, including the recent hit "Skyfall," has an interactive division that published the "RoboCop" action-shooter game for consoles and PCs in 2003.

The three companies have worked together previously before signing the latest investment deal. More than a year ago, Kabam partnered with Warner Bros' interactive division to co-develop "The Hobbit, Kingdoms of Middle-earth" mobile game based on Peter Jackson's "The Hobbit Trilogy" that was produced by MGM and New Line Cinema.

Warner and Kabam are developing a second Hobbit game, "The Hobbit: Armies of the Third Age," for release early next year. The first of three planned "The Hobbit" movies, will be released on December 14.

Google Ventures, Intel Capital, Canaan Partners and Redpoint Ventures have previously invested in Kabam, which has offices in the United States, China and Luxembourg.

Kabam generated more than $100 million in gross revenue in 2011 and has grown that by over 50 percent this year, a Kabam spokesperson said.

(Reporting By Malathi Nayak; Editing by Matt Driskill)

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