THQ WILL PURCHASE SOFTWARE MAKER GAMEFX.

Byline: Ben Sullivan Daily News Staff Writer

In an effort to expand its in-house development ability, video-game publisher THQ Inc. said Monday that it will buy a Massachusetts-based software developer for approximately $8 million.

THQ said it will pay $600,000 cash and 250,000 shares of THQ common stock for Arlington, Mass.-based GameFX Inc. The small New England company is reported to have developed a method to accelerate the image-rendering process for computer games that feature 3-D special effects.

News of the planned purchase gave THQ stock a boost Monday, with the issue gaining 1.437, to close at 29.473 per share.

``A lot of the concerns people had with THQ in the past was that almost all of their games were coming from external development houses,'' said analyst James Lin at Los Angeles-based Wedbush Morgan Securities. ``This beefs up their internal development capability.''

After posting record earnings in February, the Calabasas company took a hit in its share price last month when it lost the rights to market games based on the World Championship Wrestling franchise. Sales of WCW games were the single largest source of income for THQ last year. THQ stock fell from a high of 32.437 a share March 10, to 18.187 a week later.

THQ Chief Executive Brian Farrell said his goal in the purchase of GameFX was to acquire its core 3-D technology and to add staff to THQ's development team. GameFX President Noah Davis will become THQ's chief technology officer, Farrell said.

THQ is expected to announce first-quarter earnings after the close of trading today. Analysts expect the company to meet or beat a consensus estimate of 40 cents per share, Lin said.