Activision to acquire RedOctane and Guitar Hero franchise

Videogame publisher Activision has confirmed that they are acquiring Californian publisher RedOctane. This company is best known for their music game Guitar Hero for the Playstation 2 gaming platform.

This deal is expected to close by the end of the current financial quarter. After the deal is completed, RedOctane will continue to operate out of its Sunnyvale offices and their management team and key employees would sign long term employment contracts with Activision.

The two companies did not disclose the financial terms of their deal and Activision clarified that the deal won’t affect its financial forecast for 2007.

Activision’s Ron Doornink said in a statement on this deal: “The success we are seeing today is a strong indicator that Guitar Hero and the many potential extensions, new platform exploitations and international versions appear to be somewhat transition proof, as consumers are responding to this product on current-generation platforms in a manner that defies traditional late-cycle behavior.”

He added: “We think the online capabilities of the next-generation platforms offer new and well differentiated opportunities to create additional revenues from downloadable music, which today represents one of the most popular downloadable content categories.”