Disney Discussing Buying Playdom for Over $500 Million

Walt Disney (DIS) is discussing a deal to buy Playdom for over $500 million in a bid to increase its presence in social network games. Disney could use Playdom to incorporate some of its iconic brands and characters into social network gaming, The Wall Street Journal said without naming its sources.

Playdom ranks third among makers of social games on Facebook. It has about 42 million active users of its games each month.

Disney already holds an investment in Playdom through its venture capital fund Steamboat Ventures. The Disney fund recently participated in a $33 million financing round for the game maker. Disney also has an agreement with Playdom to develop social games using Disney's ESPN brand.