Kabam Takes Strategic Investment From Warner Bros., Metro-Goldwyn-Mayer

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Kabam, which is behind iOS hits like Kingdoms of Camelot and The Hobbit: Kingdoms of Middle-Earth, just took a strategic investment from Warner Bros. Entertainment and Metro-Goldwyn-Mayer Studios Inc.

We don’t know the terms of the deal, but it follows a recent partnership between the two companies where Kabam took Lord of the Rings intellectual property and parlayed that into two different titles. The Hobbit: Kingdoms of Middle-Earth is basically a re-skinning of their original iOS title, but it’s also done quite well on the top-grossing charts and currently holds a #21 ranking in the U.S. iPhone charts. Kevin Tsujihara, who is president of Warner Bros. Home Entertainment takes a seat on Kabam’s board while MGM’s chairman and chief executive officer Gary Barber joins as a board observer.

Whatever the amount of funding it is, it adds onto Kabam’s already hefty $125 million in venture capital from four separate rounds. Kabam CEO Kevin Chou has already alluded to loose plans for an eventual IPO, but public markets have not been very hospitable to U.S. freemium gaming companies with Zynga’s valuation down to around $2 billion from a $14 billion figure before it filed its S-1.

Kabam is one of the most heavily funded gaming companies that has titles in the top 50 grossing on the iOS and Android. They were one of the early companies to experiment with midcore gaming on the Facebook platform. But like many other developers, they pivoted toward iOS and Android when user acquisition became expensive and complicated on the Facebook platform.

“We partnered with Kabam almost a year ago to deliver incredible games for The Hobbit trilogy, arguably one of the top intellectual properties in the world,” Tsujihara said in a statement. “As we worked with Kabam, it became clear that a closer, more strategic partnership made sense for us both. Kabam is a leader in the industry and we look forward to being a part of their continued growth.”

Kabam is already at work on another Hobbit title that’s currently in beta. The Hobbit: Armies of the Third Age is set for release early next year, following the premiere of the first of the three Hobbit films on December 14.