Embracer Group is restructuring into three separate companies.
The press release is wild and starts with embracer announcing "A transformative step for value creation through a separation of the group into three market-leading games and entertainment companies."
Key process components:
- Shares of Asmodee Group (“Asmodee”) and “Coffee Stain & Friends” are intended to be distributed as a dividend to the shareholders of Embracer Group and listed on Nasdaq Stockholm, in accordance with the Lex ASEA rules. “Middle-earth Enterprises & Friends” is intended to remain within the current listed company Embracer Group, which will subsequently be renamed.
- The listing and distribution of shares (the “distribution” or “spinoff”) in Asmodee is expected to take place within 12 months and the listing and distribution of shares in “Coffee Stain & Friends” during calendar year 2025.
- As part of the Asmodee separation process, Embracer Group has, through Asmodee Group, entered into a new financing agreement amounting to EUR 900 million. The proceeds from the financing are used to repay existing debt and reduce leverage in the remaining Embracer Group. As announced today and further detailed in a separate press release available at embracer.com/investors.
- As part of the transformation and ahead of each separation the full capital structure, including both equity and debt, will be reviewed in Asmodee and “Coffee Stain & Friends” to create the best possible long-term foundation for each entity as a separately listed company.
- The largest shareholder, Lars Wingefors AB, intends to form a new long-term ownership structure, including the current holdings in Embracer Group (approximately 20% of capital and 40% of votes), and will remain a long-term, active, committed and supportive owner of all three entities.
- Shareholders representing more than 50 percent of the capital and votes in Embracer Group have expressed support for the transformation plan.
The three separate publicly listed entities are expected to consist of:
- Asmodee, a global leading tabletop games publisher and distributor with an extensive studio network and IP catalogue.
- Net Sales of SEK 14.8 billion and Adjusted EBIT of SEK 1.9 billion on a pro forma basis as per LTM[2] December 2023
- “Coffee Stain & Friends”, a diverse gaming entity with a dual focus on indie and A/AA premium and free-to-play games for PC/console and mobile, with a high degree of recurring revenues.
- Net Sales of SEK 10.9 billion, Adjusted EBIT of SEK 2.8 billion on a pro forma basis as per LTM December 2023.
- “Middle-earth Enterprises & Friends”, a creative powerhouse in AAA game development and publishing for PC and console, as well as the stewards of The Lord of the Rings and Tomb Raider intellectual properties, among many others.
- Net Sales SEK of 14.1 billion, Adjusted EBIT SEK 2.0 billion on a pro forma basis as per LTM December 2023.
It's worth reading the whole thing if you enjoy a bunch of corporate bullshit doubletalk and the schadenfreude of seeing hubris rewarded with failure, but behind all the garbage are real people's lives who have been upended because of this whole transparently idiotic project. It's been bad for games, yes, with a lot of studios disrupted and projects canceled, but it's been worse for developers who have lost their jobs and had their lives completely turned upside down by corporate practices that even outsiders could see had no shot of actually paying off.
Embracer will be a legend of the industry up there with the original THQ. Just dumb, dumb, management stuff in an industry where even smart managers are struggling to keep studios together and continue making profitable games.
Log in to comment