Marking one of the movie studios' most aggressive forays into a burgeoning entertainment business, Warner Bros. has submitted a $33-million bid for most of the assets of Midway Games Inc., the bankrupt video game publisher previously owned by Sumner Redstone.
Should the offer be accepted and approved, Warner will own all of Midway's intellectual property, including the popular Mortal Kombat fighting series, as well as game development studios in Chicago and Seattle.
Warner Bros. is one of four major studios that has in the last few years started investing in video game production, instead of just making licensing deals with traditional publishers. Along with Walt Disney Co., it stands as the biggest, having spent hundreds of millions of dollars to acquire development studios and publish its own games, which have included Lego Batman and F.E.A.R. 2: Project Origin.
Although Warner Bros. representatives declined to comment, a person familiar with the deal said it had been spearheaded by Kevin Tsujihara, the president of home entertainment who has led Warner Bros.' move into video games, with mixed results.
It's not the studio's first attempt this year to buy a small video game publisher, many of which have been struggling in an increasingly consolidated industry. Warner Bros. made an unsuccessful bid for Eidos, the British maker of Tomb Raider, which was ultimately bought by Japanese publisher Square Enix for $120 million.
Although Warner Bros. and Disney are the only traditional media companies publishing full slates of games, Paramount and Universal have both released several of their own games in the last six months.
In addition, producers Jerry Bruckheimer and Thomas Tull have both recently hired experienced video game industry executives to shape their strategies.
Midway wouldn't be the most expensive video game investment by a film studio, but it arguably would be the most significant. The company has roots that go back to the 1950s, but it's best known for its arcade titles from the 1980s and '90s. Mortal Kombat, which was released in 1992, has generated more than $1.5 billion in revenue. Midway also has a number of well-known titles in its library such as Joust and Spy Hunter.
If its bid is successful, Warner Bros. would have the right to not only publish these video games but also adapt them into films or other media. Two Mortal Kombat movies were released in the 1990s by Warner subsidiary New Line. One of Midway's properties, Wheelman, is in development as a film at Paramount with the game's star, Vin Diesel, attached.
