Microsoft has acquired Twisted Pixel Studios, according to a recent Microsoft press release:

As a step in continuing to deliver Microsoft Studios’ innovative game and entertainment offerings, Microsoft has announced the acquisition of Austin, Texas-based game developer Twisted Pixel, the creative minds behind Xbox LIVE Arcade titles such as “Splosion Man” and the recent Kinect for Xbox 360 title, “The Gunstringer.”

Twisted Pixel joins other globally-recognized game creators such as Lionhead Studios and Rare Ltd who have also been acquired by Microsoft.