Embracer Group, the games industry player that has been snapping up studios and IPs for a while now, is currently a bit…wobbily. After a $2 billion (reportedly Saudi) investment deal fell through, it has had to totally change its plans, which will now have to include studios closures and layoffs.
That deal dissolved through unknown reasons, but after glumly announcing the news, Embracer shares dropped 40%. Now, as part of its attempted recovery, Reuters reports it is considering selling of Gearbox, of Borderlands and more recently Remnant 2 fame, which they purchased just two years ago in 2021 for $1.4 billion. I supposed that would be most of the way to filling a $2 billion hole. But the same source was unclear if the deal would actually happen.
Embracer has bought dozens of smaller studios and a few larger ones since 2017. Gearbox was probably its highest profile deal, but famously, Embracer bought Crystal Dynamics and Eidos Montreal off Square Enix in 2022, gaining access to a storied IP, Tomb Raider, where a new game is supposed to be in development, alongside other IPs like Deus Ex and Thief. The deal felt like something of a steal at just $300 million.
As for Gearbox, Borderlands 4 is currently in development, the franchise being a huge seller across three mainline games now and a few spin-offs. A Borderlands movie is also on the way in 2024, somehow starring two different Oscar winners, Cate Blanchett and Jamie Lee Curtis.
If Embracer is selling Gearbox, who would be buying? 2K has remaining a publisher of the Borderlands series despite this deal. But in terms of a full sales, the obvious suspects are Sony and Microsoft, both snapping up high profile developers from Bungie to the monstrous Activision-Blizzard. Gearbox would be “cheap” compared to some of these past deals, and Borderlands is a solid IP to lay hands on.
Embracer shares have ticked up in the wake of these sale rumors, which again, if they can get a similar price for Gearbox, would go some amount of distance to plugging their $2 billion hole. But they’d lose one of their largest purchases just two years after making that deal.
I am somewhat concerned about the fate of Crystal Dynamics and Eidos, given the current situation over there, but there’s no info about them in this news. Crystal Dynamics is still doing a new Tomb Raider game and Eidos Montreal is reportedly working a new IP. We’ll see what happens from here. Embracer has not commented on this report.
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