Activision, Inc. has exercised its option to acquire the remaining 60% equity interest in Gray Matter Interactive Studios. Under the terms of the agreement, Gray Matter Interactive Studios will become a wholly owned subsidiary of Activision. Activision issued 133,690 shares of common stock in connection with the acquisition. "Gray Matter has a very talented team of programmers, designers and artists and we are confident that the studio's development strengths will further establish Activision as a leader in the PC action genre," stated Ron Doornink, president and COO of Activision.

Independent animation studio Wild Brain, Inc. has signed a co-production and development deal with Denmark's Egmont Imagination. The first co-production between the two companies is a 26 x 30' CG-animated series VANILLA PUDDING. The series will feature a quirky little girl who imagines herself as a superhero to handle the trials and tribulations of growing up. VANILLA PUDDING was created by in-house Wild Brain director Nicholas Weigel, with the pilot script penned by Emmy Award winner Sherri Stoner (TINY TOONS, ANIMANIACS, CASPER).

Iwerks Entertainment Inc. and Toronto-based SimEx Inc., have confirmed the completion of their previously announced merger. Iwerks is now a wholly owned subsidiary of SimEx Inc. The merger was made final on January 9, 2002. Pursuant to the terms of the merger, each share of Iwerks' issued and outstanding common stock, other than shares held in its treasury, was cancelled and automatically converted into the right to receive approximately $0.63 in cash, without interest. On the effective date, Iwerks had 3,554,301 shares of common stock issued and outstanding.

Troubled German media company EM.TV’s new CEO Werner Klatten is close to closing the previously announced purchase of a 25.1% stake (approximately 36.2 million shares) in the company from founder and former president Thomas Haffa. Klatten is working with a venture capital firm to secure financing for the deal, which is scheduled to be completed by the end of January 2002. The acquisition is currently estimated at US$60 million.

Scholastic Corporation has acquired Tom Snyder Productions from Canadian-based publishing company Torstar Corporation for US$9 million. Included in the purchase is the company’s television animation production division Soup2Nuts, producers of Comedy Central’s DR. KATZ and Cartoon Network’s HOME MOVIES. Tom Snyder Productions, a leading developer and publisher of award-winning educational software will be part of the interactive educational software division reporting to Margery Mayer, executive vice president of learning ventures.

Interactive software developer and distributor THQ Inc. has completed its acquisition of digital entertainment creator Rainbow Studios by issuing 858,203 shares of common stock. These shares are subject to adjustment pending the determination of Rainbow's net book value. THQ also assumed existing Rainbow stock options providing for the further issuance of 106,259 shares of THQ common stock. Rainbow Studios is now a wholly owned subsidiary of THQ. Mark DeSimone and Tony Sutterheim will continue to manage Rainbow Studios as president, games and president, animation, respectively.

Iwerks Entertainment Inc. and Toronto-based SimEx Inc., have had their previously announced merger approved by Iwerks shareholders. When the merger is completed, Iwerks will become a wholly owned subsidiary of SimEx Inc. and cease being traded on the OTC Bulletin Board. The merger was expected to close December 28, 2001 but did not, and no new date has been set. Iwerks and SimEx continue to discuss the merger and related activities. Iwerks Entertainment Inc., founded in 1986, is the number one provider of 8/70 Large Format Theater systems worldwide and the industry leader in ride simulation.

Independent animation studio Mercury Filmworks recently opened a full feature and episodic television production facility in Toronto, Ontario. The expansion has nearly doubled the company’s studio capacity and increased its talent to 120 employees in Vancouver and Toronto. A deal with Nelvana Limited to work on a 13-episode season of RESCUE HEROES II allowed Mercury the resources to open the Toronto location. Mercury successfully wrapped the RESCUE HEROES II series at the end of October 2001. The series airs on Teletoon in Canada and Kids’ WB! in the U.S.

FrameStore, specialists in visual effects and computer animation for commercials, film and broadcast television, and Computer Film Company (CFC), renowned for its award-winning digital film effects, as well as pioneering development in digital film, have merged. The newly rebranded company is named Framestore CFC and will be led by a single management team, headed by joint chief executives Sharon Reed and William Sargent. The 240 staff positions and the senior management team remain unchanged.

Design and production studio Charlex has formed a 3D department, adding new equipment and creative talent to the company’s existing setup. Bryan Godwin, formerly of Blue Sky Studios, heads the new team of 3D artists -- who bring extensive experience in the worlds of feature film and videogame production. The new group has recently completed a holiday spot for AT&T, and two spots for Sunny Delight.