Embracer Group, the embattled gaming conglomerate that owns the rights to ‘The Lord of the Rings’ franchise, has announced that it is splitting into three different companies. The group, which went through significant restructuring this year and sold off major game studios like Saber Interactive and Gearbox to reduce debt, will separate into Asmodee Group, Coffee Stain & Friends, and Middle-earth Enterprises & Friends. The three games and entertainment companies will be standalone, publicly listed entities, Embracer said, with the split “enabling each entity to better focus on their respective core strategies and offer more differentiated and distinct equity stories for existing and new shareholders.”
The announcement follows a long restructuring process for Embracer, which led to shutting down of three studios, sale of two studios and mass layoffs across Embracer-owned entities. In a press release, the company also confirmed that Middle-earth Enterprises & Friends entity will retain the intellectual property rights for The Lord of the Rings and Tomb Raider franchises and will remain within Embracer Group, which will be renamed in time.
Additionally, shares of Asmodee and Coffee Stain & Friends will be handed out as a dividend to Embracer shareholders and listed on Nasdaq Stockholm. In the case of Asmodee Group, Embracer has also entered a new financing agreement amounting to EUR 900 million (roughly Rs.7,991 crore). The proceeds from the financing process will be used to settle Embracer’s debts and reduce leverage, the company said.
Under the transformation plan, Asmodee will carry on operating as a tabletop games publisher and distributor and will retain the rights to its IPs. Coffee Stain & Friends, on the other hand, will maintain “dual focus on indie and A/AA premium and free-to-play games for PC/console and mobile,” the company said.
“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,” Lars Wingefors, CEO of Embracer Group, said in the release. “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,” he added.
Asmodee owns 23 studios that hold IP rights to popular tabletop, board and card games like 7 Wonders, Catan, Exploding Kittens and more. According to Embracer, Asmodee is overseeing the development of licensed tabletop games based on Lord of the Rings, Marvel, Game of Thrones, Netflix, Lego and Star Wars.
Coffee Stain & Friends will operate under distinct ‘Premium’ and ‘Free to Play’ segments, with the former including studios like Coffee Stain, Ghost Ship, Tarsier, Tuxedo Labs, THQ Nordic and Amplifier Game Invest. The Premium segment holds the IP rights to popular games like Deep Rock Galactic, Goat Simulator, Satisfactory, Wreckfest, Teardown, Valheim and more. The Free-to-Play side of operations will include Easybrain, Deca, CrazyLabs and Cryptic and IPs like Sudoku.com, Blockudoku, Jigsaw Puzzle and more.
Middle-earth Enterprises & Friends, on the other hand, is “intended to remain a creative powerhouse in AAA game development and publishing for PC/console”, with a focus on the Lord of the Rings, Tomb Raider and other major IPs. The entity will own key game studios like Crystal Dynamics, Dambuster Studios, Eidos-Montréal, Flying Wild Hog Studios, Tripwire, Vertigo Games, Warhorse Studios and 4A Games, with rights to IPs like Dead Island, Killing Floor, Kingdom Come Deliverance, The Lord of the Rings, Metro and Tomb Raider.
After years of spending spree that saw Embracer acquire multiple game studios and IP rights, the company went into damage control mode after a $2 billion (roughly Rs. 16,672 crore) investment deal with Saudi Arabia-based Savvy Group fell through last year. Embracer took on significant restructuring efforts this year to plug a debt of over $1.5 billion, selling off Gearbox to Rockstar Games parent Take-Two Interactive and divesting Saber Interactive in March. The restructuring process also saw Embracer shutting down operations at Saints Row developer Volition Games, TimeSplitters studio Free Radical Design, and newly formed studio Campfire Cabal.
Source link
