HONG KONG, April 10 (Reuters) - China's NetEase ( NTES )

and U.S. games peer Microsoft ( MSFT ) said on

Wednesday they will bring popular titles including "World of

Warcraft" back to China after a fallout involving the developer

that ended an almost 15-year partnership.

The pair said they are working to bring online games from

Blizzard Entertainment, a subsidiary of Activision Blizzard

which Microsoft ( MSFT ) bought last year, back to the world's

second-largest economy, starting this summer. NetEase ( NTES ) was the

publisher of Blizzard games in China from 2008 to 2023.

"We at Blizzard are thrilled to reestablish our partnership

with NetEase ( NTES ) and to work together, with deep appreciation for

the collaboration between our teams, to deliver legendary gaming

experiences to players in China," said Blizzard Entertainment

President Johanna Faries in a joint statement.

NetEase ( NTES ) and Microsoft ( MSFT ) also said they have agreed to explore

bringing NetEase ( NTES ) titles to Microsoft's ( MSFT ) Xbox and other gaming

platforms.

This "might be more consequential in the long run for

NetEase ( NTES ) as it is aspiring to increase its overseas exposure,"

said Nomura head of China internet equity research Jialong Shi.

NetEase's ( NTES ) share price rose about 2% in Wednesday morning

trade, adding to an around 3% gain on Tuesday fuelled by news of

the impending announcement from China's second-largest video

games company by revenue after Tencent ( TCTZF ).

A number of Blizzard's games were taken offline in China in

January 2023 after the developer terminated the partnership with

NetEase ( NTES ) citing disagreement over intellectual property control.

The pair subsequently sued each other.

Tension eased after Microsoft's ( MSFT ) October acquisition of

Activision Blizzard, which was followed by management changes.

Chinese media then reported that Microsoft ( MSFT ) and NetEase ( NTES ) were

seeking ways to re-launch Blizzard games in China.

The renewed publishing agreement covers Blizzard's flagship

games "World of Warcraft" and "Hearthstone" as well as other

titles in the "Warcraft", "Overwatch", "Diablo" and "StarCraft"

franchises, Wednesday's statement showed.

"We have always expected NetEase ( NTES ) will regain distribution

rights of Blizzard's games, and the reengagement translates to

about 2% incremental earnings for NetEase ( NTES )," said Morningstar

analyst Ivan Su.

Blizzard games were popular in China, with local media

estimating Chinese players of "World of Warcraft" alone at

around five million in 2009 after NetEase ( NTES ) became the publisher.

The breakup sparked outcry with Chinese netizens bemoaning

lost access to favourite games. Over a million users requested

refunds for unspent in-game credit, NetEase ( NTES ) customer service

said shortly after the games were taken offline.