Activision has acquired UK-based developer Bizarre Creations, a leader in the racing category, a US$1.4 billion market that is the fourth most popular video game genre and represents more than 10 per cent of the total video game market worldwide.

This acquisition represents the latest step in Activision's ongoing strategy to enter new genres. Last year, Activision entered the music rhythm genre through its acquisition of RedOctane's Guitar Hero franchise, which is one of the fastest growing franchises in the video game industry.

With more than 10 years' experience in the racing genre, Bizarre Creations is the developer of the innovative multi-million unit franchise Project Gotham Racing, a critically-acclaimed series for the Xbox and Xbox 360. The Project Gotham Racing franchise is owned by Microsoft.

Bizarre Creations is currently finishing development on third-person action game The Club, for Sega, which is due to be released early 2008. They are also the creators of the top-selling arcade game series Geometry Wars on Xbox Live Arcade.

Bizarre Creations and its games have won numerous industry awards including Best Racing Game for Project Gotham Racing 2 from the prestigious British Academy of Film and Television Arts (BAFTA).

Mike Griffith, President and CEO of Activision Publishing, Inc., commented, "Bizarre Creations will play an important role in our growth strategy as we develop an original new intellectual property for this important racing segment, expand our portfolio in other genres and utilise their proprietary technology for cross platform development."

Martyn Chudley, Managing Director of Bizarre Creations, added, "Our goal at Bizarre Creations has always been to do all we can to nurture our creative and passionate teams, who excel at and enjoy what they do. Activision's independent studio model will continue giving us creative freedom to build exciting new brands. Their financial support and marketing prowess will also enable us to build upon the commercial success that we currently enjoy, and take the company - and our games - to an even higher level."

Under the terms of the acquisition, Bizarre Creations will become a wholly owned subsidiary of Activision and the company's management team and employees continue with the company as their teams start to develop two new titles alongside their current projects. The 160-strong development studio is located in Liverpool, England. Activision expects that its first game from Bizarre Creations will be released after fiscal year 2009.