The Grudge 2, the sequel to Japanese hit horror The Grudge (Juon), was sold to France, Germany, Spain, Hong Kong, Korea and Thailand at Cannes this year, while over 18 other countries, including the US, are in negotiations.

The Grudge was sold to over 30 territories, including the US where it was distributed by Lions Gate Entertainment, which is heading the race with US rivals to pick up the North American rights to the sequel.

Sam Raimi's Ghost House Pictures has already acquired the US remake rights to The Grudge with the original director Takashi Shimizu himself in the director's chair. The company has also acquired the primary option to make a remake of the sequel.

"I was amazed to see the buyers rushing into our booth to purchase the film at Cannes," said Taka Ichise, producer of The Grudge and The Grudge 2. "We are expecting to make over $1m world sales in over 30 countries."

Distributed by Xanadeux, The Grudge was released on 120 screens nationwide in Japan in 2002 and grossed $3.3m (Y400m) at the local box office. "I'm expecting the sequel to take over $8.3m (Y1b) at the Japanese box office," said Ichise.

The Grudge 2 is scheduled to be released in Japan in August 2003 on 150 screens. Xanadeux handles the film's local distribution while Japan's Kadokawa Publishing and Canada's Horizon Entertainment are handling world sales.