Online Gaming Company Acquired by GigaMedia

Cambridge, MA-based Grand Virtual, a privately held software developer and ASP for the online gaming industry, has been acquired by Taipei, Taiwan-based GigaMedia, in an all-cash transaction valued at approximately $32.5 million.

Established in 1997, Grand Virtual develops software for online entertainment services, including online gaming and social networking. Grand Virtual, as an ASP, also offers “turnkey” solutions for games of skill and chance, which it sells predominantly to online licensees in Europe and Asia.

Meanwhile, AP reports that the stock of GigaMedia jumped Monday after Microsoft said it had the option to buy a stake in the company… it has a warrant to buy 10 million shares of GigaMedia, which would be a 17 percent stake in the company.

Aside from its Internet business, GigaMedia operates Taiwan’s two largest music-store chains, Rose Records and Tachung Records.