The9 to Raise $24 Million to Invest in Red 5

Red 5 Studios' parent company, The9, has launched an initiative to issue $24 million in common stock to Shanghai Oriental Pearl Culture Development Ltd. The issuance of the stock will make the company a 20% shareholder in Red 5.

The value of the shares is based on a pre-money valuation of Red 5's forthcoming online shooter, Firefall. According to a statement released today, Firefall is valued at $100 million.

The9 acquired a majority stake in Red 5 Studios - founded in 2005 by former Blizzard staff - in March 2010. The company announced Firefall in September 2010, but the game only entered open beta in July this year.

Red 5 recently laid off 10 per cent of its workforce. The redundancies were attributed to an internal reorganisation as Firefall moved towards its full release.

Source: GamesIndustry.biz