H.K. firm invests in Korea’s MGame

CDC Games takes an undisclosed share

HONG KONG — Hong Kong’s CDC Games is taking an undisclosed share in South Korea’s MGame Corp., making it the largest external shareholder of the online gaming company.

Friday’s agreement marks the latest CDC Games investment as part of CDC Games Studio, a subsidiary that has up to $100 million to invest in development partners for games geared toward the China market.

CDC Games, a unit of CDC Corp., which trades on the Nasdaq, declined to give investment details until the deal closes.

“As we expand from a licensing partnership into a co-owner of the intellectual property, we will gain increasing ability to co-develop and distribute games that are culturally aware, entertaining and educational to the millions of online game users in China,” said Fred Wang, chairman of CDC Games.

CDC Games will also get exclusive distribution rights in China for MGame’s next multiplayer online role playing game, “Wind Forest Fire Mountain.”

CDC Games also extended the license of “Yulgang” to 2010. After 20 months in the market, “Yulgang,” which is free to play while users pay for merchandise, has amassed 46.5 million registered users as of end February.

Revenue from merchandise purchases was more than $40 million last year, said CDC Games prexy John Lee.

MGame, which was founded in 1996, has more than 50 games in service on the company’s site with 19 million registered users.

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