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Disney to Invest $1.5 Billion in Epic Games, Collaborate on ‘Interoperable Ecosystem’

The Walt Disney Company will invest $1.5 billion to acquire an equity stake in Epic Games as the companies begin a multiyear collaboration on games and entertainment experiences.

The transaction is subject to regulatory approvals and other customary closing conditions, the companies said in a Wednesday (Feb. 7) press release.

With this new collaboration between the entertainment and media company and the video game and software developer, consumers will be able to “play, watch, shop and engage with content, characters and stories” from Disney brands and franchises like Disney, Pixar, Marvel, “Star Wars” and “Avatar,” according to the release.

“This marks Disney’s biggest entry ever into the world of games and offers significant opportunities for growth and expansion,” Robert A. Iger, CEO of The Walt Disney Company, said in the release. “We can’t wait for fans to experience the Disney stories and worlds they love in groundbreaking new ways.”

Disney and Epic Games have already partnered on content integrations, season collaborations, in-game activations and live events around Epic Games’ Fortnite online video game and game platform, according to the release. One part of this partnership, the Marvel “Nexus War with Galactus,” drew 15.3 million concurrent players.

In addition, Epic Games’ Unreal Engine has been used to produce content for Disney video games, films and amusement park attractions, the release said.

Disney is a leading game licensor, per the release. Its licensed mobile games have 1.5 billion global installs, nine licensed game franchises have each grossed more than $1 billion in sales, and its licensed game titles regularly earn spots in annual top 10 lists.

“Disney was one of the first companies to believe in the potential of bringing their worlds together with ours in Fortnite, and they use Unreal Engine across their portfolio,” Tim Sweeney, CEO and founder of Epic Games, said in the release. “Now we’re collaborating on something entirely new to build a persistent, open and interoperable ecosystem that will bring together the Disney and Fortnite communities.”

It was reported in December that the streaming service Disney+ was exploring new categories, such as launching gaming and shopping options, in an effort to expand beyond just offering video content.

For its part, Epic Games is reportedly looking into launching its own subscription service as it and other game developers compete for consumers’ recurring spending.