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Viacom's MTV buys Neopets for $160m

Website purchase boosts children's program offerings

PRINCETON, N.J. -- Viacom Inc.'s MTV Networks bought closely held Neopets Inc. for $160 million, adding the youth-oriented website to a children's programming lineup that includes SpongeBob SquarePants and Rugrats.

Neopets.com lets people create ''virtual pets" and gets more than 5 billion page views a month, Viacom said in a statement. Glendale, Calif.-based Neopets's chief executive Doug Dohring and other senior managers will stay on after the purchase, which closed yesterday.

Viacom, the third-biggest US media company, is adding Web content as it plans to split into two next year, allowing its faster-growing cable operations to trade separately from the CBS broadcast network. Neopets already has spurred plans for a movie with Warner Bros. and Sony Corp. computer games. The purchase will help Viacom expand its merchandising business, said MTV Networks vice chairman Herb Scannell in an interview.

''Kids have always been important to the MTV division," said Peter Jankovskis, director of research at Lisle, Ill.-based Oakbrook Investments LLC, which owns Viacom shares.

Neopets.com was founded by British college students Adam Powell and Donna Williams in 1999, according to the company's website, and now operates in 10 languages.

Site users, who ''adopt" pets that live in a world called Neopia, play interactive games, exchange messages, and submit stories, poems and comics. Time Warner Inc.'s Warner Bros. is developing a Neopets movie based on the creatures, which are cartoon animals with special powers and habits.

''We have the ability to create properties with their own hero and villain characters that can be merchandised," Dohring said in an interview. About 141 million Neopets have been created, he said.

The company, which brings in most of its revenue through advertising, employs about 120 people and is profitable, Dohring said.

About 39 percent of the site's users are younger than 13 and 40 percent are between 13 and 17 years old, Neopets said, citing Media Metrix data. About 57 percent are female and users spend about 6 hours and 15 minutes on the site per month, the second-most time of any Internet site, Neopets said.

Viacom's MTV Networks operates more than 100 channels, including Nickelodeon, and VH1.

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