Digital Trends

Halo developer Bungie Studios is going to break away from Microsoft, but the Redmond company will retain a stake - and, of course, the Halo franchise.

The rumors turned out to be true: Microsoft and Bungie Studios have announced a new agreement which will allow Bungie to break away from Microsoft as an independent company. Under the terms of the deal, Microsoft will keep a minority equity stake in Bungie, and the companies will extend the publishing agreement for the lucrative, Bungie-developed Halo franchise, as well as future properties developed by Bungie.

Microsoft just released the third (and supposedly final) installment in the Halo franchise for the Xbox 360; the game is already a financial success for Microsoft, pulling in over $300 million in sales during its first week and serving to drive Xbox 360 sales and Xbox Live memberships.

"We are supporting Bungie's desire to return to its independent roots, we will continue to invest in our Halo entertainment property with Bungie and other partners, such as Peter Jackson, on a new interactive series set in the Halo universe," said Microsoft Game Studios VP Shane Kim, in a statement. "We look forward to great success with Bungie as our long-term relationship continues to evolve through Halo-related titles and new IP created by Bungie."

Microsoft bought Bungie back in 2000; the studio was previously well-known for its games Myth, Oni, and Marathon. At the time, Bungie stopped developing for anything but the Xbox (and, eventually, the Xbox 360) and Take Two took over Myth and Oni in exchange for Microsoft buying out the company's minority stake in Bungie.

"This exciting evolution of our relationship with Microsoft will enable us to expand both creatively and organizationally in our mission to create world-class games," said Bungie head Harold Ryan "We will continue to develop with our primary focus on Microsoft platforms; we greatly value our mutually prosperous relationship with our publisher, Microsoft Game Studios; and we look forward to continuing that affiliation through Halo and beyond."