Ubisoft Jumps After Purchase of Tom Clancy Name for Games

March 25 (Bloomberg) -- Ubisoft Entertainment SA, Europe's second-largest maker of video games, rose the most in two months in Paris after agreeing to buy the rights to the name of author Tom Clancy, whose books have been adapted for Ubisoft games.

The shares rose as much as 5.91 euros, or 12 percent, to 54.98 euros, and traded at 53.89 euros at 11:44 a.m. in Paris. Before today, shares of Ubisoft, based in the Paris suburb of Montreuil-sous-Bois, had slipped 29 percent this year.

Ubisoft agreed with Clancy to buy all intellectual property rights to his name for video games and related products such as books and movies, the company said March 20. Royalty savings from the accord will lift operating profit by at least 5 million euros ($7.8 million) a year, the company said.

``Acquiring the perpetual property rights to the Tom Clancy name for video games and related projects is a major event,'' Chief Executive Officer Yves Guillemot said in the statement.

Tom Clancy-based titles accounted for 30 percent of Ubisoft sales in its fiscal year through March 2007. The name was the fourth-best selling video-game brand in the U.S. in 2006, with sales of $161 million, according to Ubisoft.

The games maker plans to release a new title called ``Tom Clancy's EndWar'' in fiscal 2009. Existing best-selling Ubisoft titles based on Tom Clancy books include ``Ghost Recon,'' ``Rainbow Six'' and ``Splinter Cell.''

Ubisoft will buy the rights in cash on a perpetual basis and free of future royalty payments. The company didn't disclose the price, saying only that the deal means net cash will be about 130 million euros at the end of March, instead of 150 million euros expected previously. The company said it will make additional payments in fiscal 2009 and 2010.

To contact the reporter on this story: Rudy Ruitenberg in Paris at rruitenberg@bloomberg.net.

To contact the editor responsible for this story: Lars Klemming at lklemming@bloomberg.net.