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Warner, MGM invest in social games company Kabam

Warner Bros. and Metro-Goldwyn-Mayer have invested in social games producer Kabam, marking the first move by Hollywood studios in the space since Walt Disney Co. acquired Playdom for $563 million two years ago.

Unlike competitors such as Zynga that target casual players, Kabam goes after more hard-core players with games on Facebook, smartphones and tablets.

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First known for original games such as “Kingdoms of Camelot” and “Dragons of Atlantis,” Kabam has in the last year started working on licensed titles based on movies. Its first was “The Godfather: Five Families” and earlier this year the company agreed to make two games based on “The Hobbit,” the film trilogy co-produced by Warner and MGM.

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Kabam’s first game under that deal, “The Hobbit: Kingdoms of Middle-Earth” was released in November, ahead of Friday’s theatrical release of “The Hobbit: An Unexpected Journey.” A second game, “The Hobbit: Armies of the Third Age,” will come out early next year. Both are made by Kabam but released and marketed in collaboration with Warner Bros.’ video game division.

The size of the studios’ investment in Kabam was not disclosed. Warner Home Entertainment Group President Kevin Tsujihara, whose responsibilities include digital distribution and video games, and MGM Chief Executive Gary Barber are joining Kabam’s board of directors as a member and observer, respectively.

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“Partnering with Warner Bros. and MGM is a natural fit for Kabam as we create new story lines and extensions of Hollywood studios’ intellectual properties for millions of gamers worldwide,” said Kabam CEO Kevin Chou in a statement.

In 2011, Kabam raised $85 million in a fourth round of funding from a number of sources including Google Ventures.

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