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Quepasa Closes Acquisition of Brazilian Social Game Development Studio

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^{Published in Science and Technology on Friday, March 4th 2011 at 5:40 GMT by Market Wire}  

WEST PALM BEACH, FL--(Marketwire - March 4, 2011) - [ Quepasa Corporation ] (NYSE Amex: [ QPSA ]), creator and operator of [ Quepasa.com ], the popular online social network and game platform for the Latino community, has closed its acquisition of XtFt Games S/S Ltda, the owner of substantially all the assets of TechFront Desenvolvimento de Software S/S Ltda, a social game development studio based in Curitiba, Brazil.

Founded in 2006 as a developer of multiplatform console, Web and mobile games, TechFront began developing social games for Google's Orkut platform in 2010 in partnership with various international publishers, including U.S.-based eGames.

Now as part of Quepasa and operating under the name 'Quepasa Games,' XtFt/TechFront's team of 41 full-time game developers are focused on developing culturally relevant social gaming IP for the Quepasa platform, as well as for distribution to other social networks with audiences in Latin America. As both a publisher of social games and a platform for playing them, Quepasa can more effectively capitalize on the rapid growth of social games throughout Latin America and on a much larger scale.

Quepasa CEO, John C. Abbott, noted: "The addition of this talented team of developers provides Quepasa with the powerful means to offer and monetize culturally relevant social games for Quepasa.com and other social networks, like Orkut and Facebook, and eventually to mobile users across Latin America. We look forward to launching our first four social game titles between now and May of this year."

"As developer, publisher, and distributor of social games, along with being an operator of a popular social network, we will command a greater proportion of the revenues associated with social games published on our platform, while also participating in additional revenues generated on alternative social networks," said Abbott. "Our other newly formed partnerships with Sony Pictures Television Ad Sales, Grupo Expansión, and PlaySpan all serve to dramatically enhance the revenue generation potential of this TechFront acquisition."

Rafael da Costa, a XtFt partner and TechFront's founder and president, commented: "Joining forces with Quepasa gives us an immediate presence on one of the largest and fastest growing audiences in Latin America. The addition of innovative social media marketing tools like Quepasa DSM, which is also being marketed by Sony Pictures and Grupo Expansión across the region, will help promote our titles and stimulate user engagement. Publishing initially to Quepasa.com will also provide us important insights into user receptivity of new game features and functionality ahead of distributing our titles to other well-trafficked social media sites."

Quepasa acquired XtFt for $4 million, comprised of $3.7 million in shares of Quepasa common stock (348,723 shares at $10.61 per share) and a $300,000 brokerage fee. XtFt also received performance incentives to earn an additional 250,000 shares of Quepasa common stock at certain Quepasa Games-related revenue targets. Further details are provided in a Form 8-K filed with the U.S. Securities and Exchange Commission today, March 4, 2011, and available via [ www.sec.gov ].

Quepasa recently reported that its membership base increased by 2.1 million in February 2011 to total more than 31.7 million registered users. This marked a year-over-year increase of 62%, compared to growth of 1.3 million new users in February 2010. Quepasa.com also reported significant improvement in user engagement in February; page views per return site visit were 19.4, representing a 21% increase over February 2010.

Quepasa's expanding social gaming presence in Latin American is supported by strengthening user trends in the region. Revenue from in-game virtual goods in Latin America is expected to nearly double from $336 million today to $624 million by 2014, according to a recent report from digital goods tracking firm, SuperData Research, with Brazil accounting for more than half the current level.

According to another study by Social Gold, Latin America possesses the most loyal game users, spending more than users in other regions in the world. Users located in Latin America generate an estimated average lifetime spend of $300 on game-related virtual goods, as compared to Europeans at $272, followed by North Americans and Asians of $258 and $202, respectively.

About XtFt Games and TechFront Studios
XtFt Games is the owner of substantially all of the assets of TechFront Desenvolvimento de Software S/S Ltda (TechFront). TechFront is Brazil's largest game development studio for all modern game platforms, with a focus on fun, high-quality, easy-to-play titles. The company's 40+ development team brings experience not only in Flash, 3D engines, and 3D art, but also leverages internal tools and commercially licensed engines like Infernal and Gamebryo to support simultaneous multiplatform releases. For more information, visit [ www.TechFront.com.br ].

About Quepasa Corporation
Quepasa Corporation (NYSE Amex: [ QPSA ]), owns Quepasa.com, the leading online social network and game platform for the Latino community. Quepasa.com provides fun, interactive, and easy to use social tools, and rich multimedia content in English, Spanish and Portuguese to embrace Latinos everywhere, and empower them to connect online, compete in contests and games and share their interests, ideas, and activities. Quepasa is headquartered in West Palm Beach, Florida with offices in Miami, Los Angeles, Scottsdale, and Hermosillo, Mexico. For more information about the company, go to [ www.quepasacorp.com ], or join for free at [ www.Quepasa.com ].