Ubisoft, one of the world's largest video game publishers, has closed an agreement with Tom Clancy to acquire all intellectual property rights to the Clancy name.
The agreement is on a perpetual basis and free of all related future royalty payments, for use in video games and ancillary products including related books, movies and merchandising products.
The price of the all-cash acquisition was not currently disclosed.
Post acquisition, Ubisoft expects to have a net cash position of around 130 million Euros by the end of fiscal 2007-08, compared to a previous expectation of approximately 150 million Euros.
Additional payments will be made in fiscal 2008-09 and fiscal 2009-10.
On the basis of past performance of Clancy branded video games, and excluding any potential contribution coming from sales of ancillary products, the royalty savings generated by this acquisition are estimated to increase Ubisoft's operating income at least 5 million Euros per year.
"After 10 years of a highly successful collaboration which has seen the creation of blockbusters that set standards in the videogame industry, such as Tom Clancy's SPLINTER CELL, Tom Clancy's GHOST RECON, and Tom Clancy's RAINBOW SIX, today, acquiring the perpetual property rights of the Tom Clancy name for video games and related projects is a major event," said Yves Guillemot, Chief Executive Officer at Ubisoft. "The future of our industry lies in our capacity to create and develop brands that captivate consumers and that present a myriad of opportunities for the full spectrum of entertainment, be it video games, books, movies or other media. The Tom Clancy brand is recognized around the world for offering exciting video games, films and books."