Japan's GungHo to acquire S.Korea Gravity majority

TOKYO Thu Feb 14, 2008 7:08am EST

TOKYO Feb 14 (Reuters) - Japan's GungHo Online Entertainment Inc 3765.OJ said on Thursday it would take a 52.4 percent stake in South Korean game maker Gravity Co Ltd (GRVY.O) to boost its development and marketing strength.

GungHo in April will allocate 24,308 new shares to unlisted Japanese investment firm Heartis Inc, boosting its total shares outstanding by 27 percent.

In return, GungHo is set to acquire the 52.4 percent stake in Nasdaq-listed Gravity from Heartis.

The value of the Gravity stake is estimated at about 4 billion yen ($37 million), GungHo said.

The Tokyo-based company currently distributes Gravity's popular role-playing online game, Ragnarok, in Japan. (Reporting by Kiyoshi Takenaka; Editing by Quentin Bryar)