The Embracer group is currently one of the biggest giants in the video game world. Despite everything, his appetite seems to give some nausea. Explanations with this curious rumor concerning Borderlands.
In the world of video games, for some companies, buying or buying is a habit, even a mania. This is how for several years, the Swedish group Embracer (which owns Borderlands) has continued to buy publishers or studios. This devouring appetite began in 2020 when the company announced seven acquisitions in August: 4A Games and New World Interactive, which will be under the Saber Interactive entity; Palindrome Interactive, Rare Earth Games and Vermila Studios which will be under Amplifier Game Invest; Pow Wow Entertainment which will be under THQ Nordic. The opportunity in particular to take control of the Metro 2033 success.
A wolf’s hunger for Embrace which has its limits
Far from putting an end to its gargantuan appetite, Embracer Group announced three additional major acquisitions in February 2021 with Gearbox Software for a price of $1.3 billion, but also Aspyr Media for $450 million. Colossal sums of money. But since a giant is always hungry, on May 2, 2022, Embracer Group announced an agreement to acquire Crystal Dynamics, Eidos Montreal, and Square Enix Montreal for $300 million more. Enough to put Tomb Raider in your pocket. Finally, on August 18, 2022, Embracer Group entered into an agreement to acquire Middle-earth Enterprise with all that this implies: full access to films, video games, board games, merchandising, theme parks for everything that concerns The Lord of the Rings and The Hobbit. But clearly, this wolf’s hunger is starting to be expensive, too expensive?
Big changes for Borderlands?
Indeed, according to information from the very serious newspaper Reuters, Embracer is considering different options regarding Gearbox Entertainment behind Borderlands, including a possible sale. The move is part of Europe’s largest video game company’s efforts to shore up its finances, according to three sources familiar with the matter interviewed by Reuters. Specifically, Embracer, whose shares are traded in Stockholm, would collaborate with Goldman Sachs and Aream & Co to explore this sale possibility. At this point, Embracer and Goldman Sachs officials have chosen not to comment on the situation. However, the news seemed to inspire confidence in the markets, with stocks jumping as much as 5%.
Last June, Embracer announced a restructuring plan with the aim of reducing its net debt to less than $903 million by the end of its current fiscal year. The plan, encompassing studio closures, project cancellations and layoffs, followed what CEO Lars Wingefors called a difficult year for the company. The sources, speaking on condition of anonymity due to the confidential nature of the matter, warned that a deal may ultimately not materialize. Nothing has been decided yet, but the signs seem to indicate that a significant event is being prepared. This is all the more unfortunate since last month, Gearbox launched its latest title, Remnant 2, which topped the US charts in July. This is a bit scary for the sequel to Borderlands, and we hope that the developers can all get through this without layoffs in the transactions.