The Embracer Group has been losing money lately. It recently lost out on a $2 billion investment, let go of thousands of workers, and sold Gearbox, one of its important properties, at fire sale prices. According to Bloomberg, the company has now declared its intention to divide into three distinct, publicly traded companies.
In addition to managing the Dead Island, Killing Floor, Kingdom Come Deliverance, Tomb Raider, and The Lord of the Rings properties, the first is Middle-earth Enterprises & Friends, which specializes in AAA games. The following studios are under its jurisdiction: 4A Games, Dambuster Studios, Eidos-Montréal, Flying Wild Hog Studios, Tripwire, Vertigo Games, and Crystal Dynamics. For the time being, this company will continue to be listed under the name Embracer Group.
The second is Asmodee, will handle the tabletop gaming segment of Embracer Group. Those titles include Ticket to Ride, 7 Wonders, Azul, CATAN, Dobble and Exploding Kittens. Finally, Coffee Stain & Friends is the company’s indie-centric group, with properties including Deep Rock Galactic, Goat Simulator, Satisfactory, Wreckfest, Teardown and Valheim.
“This move has been made with the intention to unleash the full potential of each team and provide them with their own leadership and strategic direction,” said Embracer Group CEO Lars Wingefors. “This is the start of a new chapter, a chapter that I intend to remain part of as an active, committed, and supportive shareholder of all three new entities, with an evergreen horizon.”
Embracer Group went on an epic buying streak between 2019-2022 when borrowing was cheap, acquiring studios and entertainment groups including Crystal Dynamics, Gearbox Entertainment, Dark Horse Media, Middle-earth Enterprises and many, many others. Those came with gaming franchises including Tomb Raider, Deus Ex, Borderlands and Saints Row.
It was forced to restructure, though, when it lost out on a $2 billion partnership deal (reportedly with Savvy Games, funded by the Saudi government). It subsequently laid off 8 percent of its staff (as of February 2024), or nearly 1,400 employees. The company also sold off Borderlands developer Gearbox for $460 million, a fraction of the $1.3 billion it was valued at three years prior.
