Atari parent company Infogrames announced today that it's reached an agreement with MMO developer Cryptic Studios to fully acquire the company, all of its proprietary IP, tools, technology and work-in-progress. Infogrames said the acquisition is "a critical step in the implementation of Atari's strategy to become a leading online game developer and publisher." The transaction is valued at $28 million and Infogrames also laid out up to $20 million in sales-related incentives.

Cryptic Studios is known best for its popular City of Heroes/Villains franchise. The developer, which employs about 150, is currently working on three MMO franchises, planned for release over the next three years on PC and consoles; Champions Online is slated for 2009, Star Trek Online has been penciled in for 2010, and there is also a third game in development that will be announced in the "near future." Cryptic's MMOs have generated over $100 million in lifetime revenues and up to 180,000 peak subscribers.

"The acquisition of Cryptic Studios brings to Infogrames an outstanding creative organization, with a proven track-record of success in the fast-growing MMO category," commented David Gardner, CEO of Infogrames. "Cryptic's success is founded on leading-edge technology and the vision of a seasoned executive management team. I am impressed with the tools and technology that Cryptic has developed to make MMOs less expensive to build. Creating vast worlds and interesting interactions can be very people intensive but with the use of Cryptic's toolset they have a proven way of cutting average production costs in half. This is exactly the type of company we wanted to acquire in order to build Atari for the 21st century."

"We share a common vision with Atari and their leadership team," said John Needham, Chief Executive Officer of Cryptic Studios. "With our game development and online platform technology skills, we're very excited about the opportunities that this unique combination with Atari creates. I am committed to helping Atari grow into a leading online game company and look forward to being part of the team."