Liberty will pay GBP83.7 million and 32.4 million shares in a company that will be newly formed for the deal. Liberty will also invest $50 million the new FUN company. Liberty will own 51 per cent of the new FUN company. Liberty Media is a holding company owning interests in electronic retailing, media, communications and entertainment businesses such as QVC, Encore, Starz, Expedia and News Corp.
FUN provides gaming systems and services to interactive entertainment groups, including AOL, MSN and Virgin. We have already been working successfully with FUN through GSN (The Network for Games), a Liberty affiliate — a relationship which underscores the effectiveness of combining compelling interactive media with television, said Liberty chairman and CEO John Malone. We look forward to building FUN’s businesses by combining FUN’s leadership in online skill games with Liberty’s media assets and expertise in using video to build popular brands and services.
Under the deal, Greg Maffei, Liberty’s new chief executive, will take a seat on the Fun board.
Our customer profile is very different from other gaming sites, said Lorne Abony, Fun’s chief executive, adding it provided online arcade games and games such as Scrabble.
Last year, the global video games market rose 11 per cent to reach $25bn in revenues, according to PwC, and is expected to grow by more than 20 per cent in 2006 and 2007.
Big media companies such as Time Warner, Viacom and Walt Disney are contemplating acquisitions to increase their presence in the online gaming sector.
