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Chinese Internet firm buys into wireless games

Tom Online is spending $17.7 million to buy a majority stake in Indiagames.

Tom Online, a Chinese wireless Internet company, said Friday that it will buy a majority stake in Indiagames, a mobile-game specialist.

Tom Online will acquire 80.6 percent of Indiagames' equity for $17.7 million, the companies said. The rest of the stake will be held by Indiagames' founder, Vishal Gondal, and key management staff.

Indiagames employs 160 people and has developed games for Hollywood studios, handset makers and service providers using the I-mode and BREW (Binary Runtime Environment for Wireless) platforms.

Tom Online said the acquisition will help it market game products globally.

The Indian wireless-game industry has been growing fast; overall revenue is projected to reach $336 million by 2009. Both India and China are among the fastest-growing mobile phone markets in the world. India has more than 43 million wireless phone subscribers, and the numbers are climbing steadily. China is projected to have 300 million mobile phone users by the end of 2004.

"Tom Online has successfully built a strong leadership in China's wireless Internet sector, which makes Indiagames the most befitting addition to our existing business lines. It will be the driving force behind our game-related services development and expansion in the Indian wireless Internet sector," Wang Lei Lei, Tom Online's chief executive, said in a statement.

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