According to reports from Reuters (via MarketScreener), Sweden’s Embracer Group is considering selling Borderlands and Half-Life developer Gearbox Software. So far there has been no official comment from Embracer concerning the sale.
Reuters cites “three people familiar with the matter”, speaking under anonymity, who also reiterated that a sale is only being considered at this stage and may not happen. However, the company is said to be working with financial institutions Goldman Sachs and Aream & Co. to explore options according to the same anonymous sources.
What Does The Embracer Group’s Restructuring Mean for Gearbox?
The news comes in the wake of comments from the Embracer Group in June where the company announced it was “restructuring” to reduce its net debt to less than SEK 10 billion ($903 million). The restructuring plans include studio closures, layoffs and the cancellation of ongoing projects.
However, the Embracer Group’s troubles stretch back to May, where according to Axios a $2 billion partnership with the Saudi government-funded Savvy Games Group, fell through after 7 months of negotiations. This caused a slash in Embracers’ earning forecast with its share price nosediving by over 40%.
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As of the news surrounding the potential sale of Gearbox, Embracer shares have now since turned positive and spiked as much as 5% higher. However, By 1030 GMT they had tempered gains but were still up 2.1%.
While Gearbox’s sale would line up with the Embracer’s plan to elevate their SEK 16.7 billion debt, it’s still a strange move considering Gearbox was only purchased in 2021. Gearbox falls under Embracer’s PC console games division and its latest published title Remnant 2, topped U.S. charts for July showing that the studio is producing quality work.
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Embracer currently has over 900 owned franchises and as of September 2023 has 129 internal game development studios with more than 15,000 employees in over 40 countries. Within Embracers owned franchise’s include the lucrative rights to The Hobbit and The Lord of The Rings which were acquired in 2022.
Along with the above properties the Swedish organisation also purchased a large part of Square Enix’s western development arm for $300 million. The deal saw Embracer becoming the owner of Crystal Dynamics, Eidos Montreal, Square Enix Montreal, and of IPs including Tomb Raider and Deus Ex.
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Despite their recent acquisitions, after the news of restructuring in June CEO Lars Wingefors has stated it has been a “challenging year” for the company. Do you think that the Embracer Group will sell Gearbox? What studio or IP could be up next on the chopping block for the Swedish company? Let us know in the comments and follow @FandomWire for the latest gaming and entertainment news.
Source: Reuters (via MarketScreener),
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