Microsoft Acquires Video Game Powerhouse Rare Ltd.

Microsoft Acquires Video Game
Powerhouse Rare Ltd.

Developers of Such Worldwide Hits
as “Donkey Kong 64,” “Banjo-Kazooie,” “GoldenEye 007” And “Perfect Dark” Bring
Their Talents to Xbox

REDMOND, Wash. — Sept. 24, 2002 —
Microsoft Corp. today announced it has purchased U.K.-based Rare Ltd., one of
the world’s leading video game developers, further demonstrating Microsoft’s
commitment to providing the most innovative interactive experiences available on
its Xbox™ video game system. Rare has been the mastermind behind some of the
most popular video games in history, including such global multimillion sellers
as “GoldenEye 007,” “Perfect Dark,” “Banjo-Kazooie” and “Donkey Kong 64.” Under
terms of the $375 million cash transaction, Rare will today begin creating
exclusive console gaming blockbusters for Xbox.

In a statement made from Seville,
Spain, where the announcement was made to both a live and worldwide webcast
audience during the company’s annual X02 event, Chris Stamper, chairman and
technical director of Rare, said, “Our mission at Rare has always been to make
the industry’s best games for the widest possible audience. Teaming with
Microsoft gives us the best opportunity to accomplish this goal. Microsoft’s
dedication and commitment to game creators, research and development, and to
gaming innovation made them the obvious partner to take Rare into the future.”

“We’ve always insisted on pushing
the envelope when it comes to creativity,” added Tim Stamper, co-founder and
creative director of Rare. “And now we get the chance to create for Xbox.”

Rare co-founders Chris and Tim
Stamper and their talented team of game developers and designers will continue
to work out of Rare in Warwickshire, England. Rare was founded in 1985 as a
partnership between the Stamper brothers and Joel Hochberg, now Rare president.

“This partnership significantly
broadens our already outstanding portfolio of games that will be available for
Xbox. And it also broadens our reach internationally as gamers around the world
have demonstrated their fanaticism for what Rare consistently produces,” said
Robbie Bach, Chief Xbox Officer at Microsoft.

“The last time I was this excited
was the first time I picked up a controller and played a game from Rare,” said
Ed Fries, vice president of Xbox Game Content at Microsoft. “As a gamer, you
could hardly wait until Rare’s next title was announced. You didn’t know what
genre it would be, but it didn’t matter because you knew you were going to love
it.”

Rare grabbed the attention of the
video game world in 1994 with its creation of “Donkey Kong Country.” Selling
more than 8 million copies, “DKC” went on to become the biggest- selling 16-bit
title in history.

Rare became one of the premiere
developers in the world, with sales averaging 1.4 million units per title and
nearly 90 million games sold since the company was founded. Five of the top 20
all-time-best-selling N64 titles were developed by Rare, including “GoldenEye
007,” the second-best-selling game in North America, with worldwide sales
topping 8 million.

With today’s announcement, Rare
becomes the latest member of a star-studded lineup at Microsoft Game Studios,
joining such prestigious worldwide developers as Bungie Studios, the masterminds
behind the smash hit “Halo™,” named Game of the Year by Electronic Gaming
Monthly. Rare’s first creation for Xbox, “Kameo,” is expected to reach store
shelves next spring. Also under development is the highly anticipated sequel to
“Perfect Dark.” The company is expecting to develop at least five games over the
next two years in a variety of genres, including racing, shooters and
platformers.

About Microsoft Game Studios

Microsoft Game Studios is a leading
worldwide publisher and developer of games for the PC, Xbox video game system
and online platforms. Comprising a network of top developers, Microsoft Game
Studios is committed to creating innovative and diverse game portfolios for the
PC (http://www.microsoft.com/games/), including such franchises as “Age of
Empires®,” “Flight Simulator” and “Zoo Tycoon™”; Xbox (http://www.xbox.com/),
including such franchises as “Halo,” “Project Gotham Racing™” and “NFL Fever”;
and Zone.com (http://zone.msn.com/), the official games channel for the MSN®
network of Internet services and home to such hits as “Bejeweled” and
“OutSmart™.”

About Xbox

Xbox is Microsoft’s
future-generation video game system that delivers the most powerful game
experiences ever. Xbox empowers game artists by giving them the technology to
fulfill their creative visions as never before, creating games that blur the
lines between fantasy and reality. Xbox is now available in North America,
Japan, Europe and Australia.

About Microsoft

Founded in 1975, Microsoft (Nasdaq
“MSFT”) is the worldwide leader in software, services and Internet technologies
for personal and business computing. The company offers a wide range of

products and services designed to
empower people through great software — any time, any place and on any device.

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