Lionhead Studios will immediately begin creating content exclusively for the Xbox 360 and Microsoft Windows platforms. The companies previously worked together on the role-playing games 'Fable'for Xbox and 'Fable: The Lost Chapters' for Xbox and Windows, which have collectively surpassed the two million global unit sales milestone.

'Fable' and 'Fable: The Lost Chapters' are designed to enable players to make decisions that affect their characters skills, appearances and morality and the world around them.

At Microsoft Game Studios we have worked hard, and this acquisition underscores our commitment to excellence, says Shane Kim, GM of Microsoft Game Studios. Peter Molyneux is one of the few true visionaries in our industry, and his joining us is incredibly important to the future of both interactive entertainment and MGS.

We could not be more excited about being part of MGS. It has long supported our creative vision, and this teamwork resulted in the 'Fable' franchise, says Molyneux, MD of Lionhead Studios.