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Chinese Game Operator Acquires Irvine’s Red 5 Studios

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Irvine’s Red 5 Studios Inc., a maker of online games started by former workers of Blizzard Entertainment Inc., said Monday it was acquired by a Chinese video game developer and operator for around $20 million.

Shanghai-based The9 Ltd. acquired a majority stake in Red 5 with the investment, the company said.

The9 develops and operates what’s called “massive multiplayer online role-playing games” in which thousands of players face off over the Internet.

Some of its licensed titles include “Soul of The Ultimate Nation,” “Granado Espada,” “EA Sports FIFA Online 2” and “Atlantica.” Its own games include “World of Fighter” and “Jiu Zhou Zhan Ji.”

“Red 5 is a creator of innovative entertainment software, designing games that focus on ease of play and fun,” said Chief Executive Jun Zhu. “With the acquisition, The9’s global strategy is beginning to take shape. It will further enhance our game development capability and diversify our game portfolio and pipeline.”

Some industry watchers say the investment helped Red 5 get back on its feet after a tough 2009.

The company quietly underwent a big restructuring earlier this year, in which some 30 jobs were cut.

Red 5 raised about $19 million in 2006 from investors Benchmark Capital and Sierra Ventures.

The company reworked its Web site earlier this year, but it’s still very bare-bones. It hasn’t disclosed anything about its current projects.

A year ago the company moved to its current office in Irvine from Aliso Viejo.

Red 5 was started in 2006 by a trio of developers who worked on “World of Warcraft,” Irvine-based Blizzard’s blockbuster online game that has some 11 million players and counting.

Red 5 is headed by Mark Kern, the original team leader who worked on “World of Warcraft.” The game continues to be a cash cow for Blizzard’s French parent Vivendi SA.

“We are very excited to welcome The9 as our key investor and to announce that they are making a commitment to us with the equity infusion,” Kern said.

Red 5 is among a local cadre of hardscrabble video game companies that have been started by former Blizzard workers in recent years.

They include Ready at Dawn Studios LLC and Crazy Pixel Games LLC, both of Irvine.

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