GameStop to buy Flash game hub Kongregate

Game retailer planning purchase of free-to-play social gaming destination; deal expected August 1, cofounders to retain leadership positions.

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GameStop is the largest video game-specific retailer in the world. It owns over 4,500 brick-and-mortar locations globally, but the company's next effort lies in the digital gaming space.

Kongregate employees now have key cards to this building.

The Grapevine, Texas-based company today announced that it has entered into an agreement with Flash game portal Kongregate to acquire the company and make it a wholly owned subsidiary of GameStop Corp. The acquisition cost was not disclosed.

The terms of the deal state that the casual game space's cofounders, Jim and Emily Greer, will retain their leadership positions at the company's San Francisco office. The agreement is currently scheduled to be finalized August 1.

Additionally, GameStop CEO J. Paul Raines said the acquisition will help his company push digital gaming by providing a "gaming platform for casual, mobile and browser games that can be promoted and played by our existing gamers."

Kongregate launched in 2007 and since that time has amassed 10 million monthly users who spend about 23 million hours a month on the Web site. The site currently houses thousands of free-to-play Adobe Flash-based games from over 8,500 developers in a number of genres. GameStop will not rebrand Kongregate and will allow the company to keep its URL. Additionally, its Web site will be fully integrated with GameStop's.

Although the cost of the acquisition was not revealed, Wedbush analyst Michael Pachter estimated it to be between $12 million and $40 million. As of press time, GameStop shares were trading down 1.2 percent to $20.49.

Discussion

27 comments
MW2GhoST
MW2GhoST

why do you have to ruin everything gamestop?

somberfox
somberfox

That's not good, not good at all. I can see them charging a subscription fee to access games. **** that, I'll use Armor Games instead.

Dark_Arkitect
Dark_Arkitect

Thankfully there's a playntrade in my neck of the woods.I despise gamestop and their rip off buy back prices thus I just don't ever go there. Sucks that Kongregate sold out to IMO,the worst video game selling franchise i've ever seen.Power to the players my ass.

spudster007
spudster007

Noooo! The community of kongregate is going to take a dive now...can't believe they sold out...

littleboomer
littleboomer

@ Poodger he would have been a lot better off selling them on craig's list or ebay. i hope they still keep kongregate free tho.

hakkinnen
hakkinnen

At least Newgrounds still is "Everything by Everyone"

Poodger
Poodger

Gamestop scares me because of how it is doing so well and growing. Last week, I went with my friend to trade in 5 PS3 games, all no more than 1 year old, some only a couple months old, and he only got $20 for all 5 games. I don't like that such a scummy company that rips people off so badly is growing like this.

Narroo
Narroo

^&$%&) NO! WHY?!

jefferson1964
jefferson1964

gamestop is ok IF you cannot buy or sell off Amazon/Ebay. Every once in a while they will have a descent sale and I dont feel ripped off, but I have given up trying to sell any games to them, they offer near nothing but then mark them up 300-800% to retail them as used games.

cornerback3
cornerback3

If they start charging for certain flash games...

Jesse-Ray
Jesse-Ray

@kamikazedragon4 Lawl I read the whole article as Gamespot, it's a bloody anagram, kind of blew my mind when it said it owned >4500 locations

vadicta
vadicta

I'd rather buy my games off Amazon

kamikazedragon4
kamikazedragon4

Hopefully we don't have to preorder flash games to get exclusive bonus content :P

PANIC99
PANIC99

I personally liek Gamestop. As a pc gamer for some reason i can find pc games i couldnt find any where else here. Such as Star Wars Battlefront 1 and etc. Although i found a $40 L4D for pc which is a ripoff.

The_AI
The_AI

This doesn't bode well. Kongregate's my favorite Flash game website and Gamestop is my least favorite game shop.

pogswarts
pogswarts

@JustinCoplen People hate Gamestop because #1 if you trade games in there they rip you off #2 "Most" of the people that work there don't know a thing about gaming #3 I don't know about the GS you go to, but mine they try to up-sale you like crazy. Other than that I don't mind them to much.

JustinCoplen
JustinCoplen

Why does everyone hate Gamestop? I love gamestop, and so long as it's not consoles will only buy from them. (Consoles are excluded from that because consoles are cheaper at costco)

BanditDee
BanditDee

Noooo, I love Kongregate! It's great to get exposure but why Gamestop? :(

ptpattycakes
ptpattycakes

Gamestop is the worst company in the world!! I will not purchase any game that has anything to do with that store!!

luffy11234
luffy11234

DX come on now i want companys 2 be companys. not a big monopoly game where Activison is the big boy, and its outlet gamespot.

gatsbythepig
gatsbythepig

I already sold all of my Gamestop stock. I will be amazed if they keep making a profit and a little bummed if their stock actually goes back up.