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Microsoft Acquires Lionhead Studios

Microsoft announced that it has acquired Peter Molyneux's Lionhead Studios, which will now develop for Xbox 360 and Windows exclusively as a part of Microsoft Game Studios. The purchase has been rumored for months, and nearly confirmed for weeks. Known as a pioneer in the games industry for games such as Populous and Syndicate, Molyneux continues to enjoy wide exposure and recognition (he was granted an Order of the British Empire last year) though several high profile Lionhead games in recent years have failed to see retail performance living up to their substantial hype. One of the company's three internal studios was recently shut down.

The studio's biggest success story has probably been its partnership with Microsoft Game Studios; 2004's Fable (Xbox) and its followup Fable: The Lost Chapters (Xbox, PC) have sold over 2 million units and the original game was the highest selling non-sequel on Xbox in the year of its release. The game is mentioned frequently throughout the press release, and is almost sure to have further titles in the series. Microsoft has also acquired the rights to other Lionhead franchises such as Black & White and The Movies, though existing contracts with other publishers will be honored.

"We could not be more excited about being part of MGS. They have long supported our creative vision, and this teamwork resulted in the hugely successful 'Fable' franchise," said Molyneux, managing director of Lionhead Studios. "This acquisition gives Lionhead the stability and opportunity to focus on creating world-class next-generation titles. We are joining some of the most incredible game creators in the industry, the combined talent of which will truly take next-generation gaming to a new level."

Molyneux has been in a corporate buyout situation before. His original studio Bullfrog, founded in 1987, was fully acquired by EA in 1995. In 1997, Molyneux left the company to found Lionhead.