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Ashley

Embracer buys a load of studios then shuts some down because it has no money

By Ashley, in General Gaming Discussion

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Posted (edited)
On 5/4/2022 at 12:14 PM, Dcubed said:

I laughed.

Anything with this dude cracks me up. Reminds me of this gem for No Man's Sky

 

 

Edited by EEVILMURRAY
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Posted (edited)

Merry Christmas to Free Radical. :(

Quote

VGC reported earlier this month that Free Radical was at threat of being closed just two years after it was established, as part of huge company-wide cuts at Embracer and its owned publishers.

Although Embracer has yet to publicly confirm Free Radical's position, sources told VGC that Wingefors has now acknowledged in a company e-mail that the Nottingham, UK-based company could be closed on December 11, following the completion of a consultation process.

"As we move through the consultation process and face the potential closure of Free Radical Design on 11 December 2023, I want to express my gratitude for your commitment and the remarkable work you've done and still keep doing," he wrote.

"This is a challenging time for all of us but especially for you, and our focus is to support you as much as we can during this transition."

 

Edited by Hero-of-Time
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Posted (edited)

What a fuck up of epic proportions.  Insane just how much of the traditional video game industry is just getting destroyed as Embracer impodes on itself.

The video game industry is so fucked.  We're gonna be looking at the next great console market crash very soon.

And not just that, but these idiots are also gonna end up taking down Middle Earth Enterprises and Dark Horse Comics along with them too.  Crazy to think that both companies involved with the LOTR movies will end up getting killed by both Unity (Weta) and Embracer (Middle Earth Enterprises) both imploding at the same time!

Edited by Dcubed
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Posted

@Dcubed Embracer also own Asmodee, a board game company that owns the majority of the modern board game market.

 

Edit: for a view of their size, they were purchased for over $3 billion.

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Posted

That's shocking.  But I suppose Embracer must be desperate at this point, and Gearbox is their most valuable singular asset (think they paid $1.2 Billion for them originally?)

I wonder if anyone else would want to buy them directly off of Embracer... Or if they'll try going it alone again?

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Posted (edited)

So... footage of this supposed "TimeSplitters 2 Remake" has surfaced and...

https://insider-gaming.com/timesplitters-2-remake-gameplay/

https://streamable.com/ga4vxi

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... maybe it's for the best that it was cancelled.

Fucking hell.  Somehow, the fact that this could've been released is even more depressing than what we thought was being cancelled was cancelled!

Edited by Dcubed
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Posted

So....Fortnite:TS Edition? Ridiculous that someone thought this was a good idea and what TS fans would want.

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Posted

...My eyes refuse to believe that's real. Not the "Fortnite spinoff" part of it, as that would indeed be something that publishers would try to do with this IP.

No, what boggles my mind is that they have the gall to call it a remake of TS2. Do words not have any meaning anymore!? If you ain't showing Syberia, you ain't showing shit!

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Posted
7 hours ago, Jonnas said:

 

No, what boggles my mind is that they have the gall to call it a remake of TS2. Do words not have any meaning anymore!? If you ain't showing Syberia, you ain't showing shit!

The "remake" (or retelling) of TS2 was what they were trying to pivot to.

The plan was seemingly to star off with a Fortnite clone that none of the developers wanted to make, get a budget, and then make the game they wanted to do.

When it came to Embracer needing to cut costs, a studio that lied to them and spent years making something they invented to discard to make something else instead was probably an easy choice.

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Posted
12 hours ago, Cube said:

The "remake" (or retelling) of TS2 was what they were trying to pivot to.

The plan was seemingly to star off with a Fortnite clone that none of the developers wanted to make, get a budget, and then make the game they wanted to do.

When it came to Embracer needing to cut costs, a studio that lied to them and spent years making something they invented to discard to make something else instead was probably an easy choice.

Ah, that makes more sense. Didn't get that feeling at all from the article that DCubed linked to, as it simply says this was a remake in development.

Thank you for the context :)

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Posted

It's official: Take-Two Interactive is set to acquire Gearbox Entertainment for $460 million (source). 

Quote

Embracer Group has today entered into an agreement to divest Gearbox Entertainment, for a consideration of USD 460 million (SEK 4.9 billion) to Take-Two Interactive Software, Inc. ("Take-Two"). The proceeds from the deal will, upon closing, significantly reduce net debt, earnout obligations and capex. Embracer retains selected companies, including Gearbox Publishing San Francisco (to be renamed), with the publishing rights to the Remnant franchise, the upcoming Hyper Light Breaker and other notable unannounced game releases.
"Today's announcement marks the result of the final structured divestment process and is an important step in transforming Embracer into the future with notably lower net debt and improved free cash flow. Through the transaction, we lower business risk and improve profitability as we transition to becoming a leaner and more focused company. After evaluating several options for Gearbox, I am happy that we have reached a solution that is in the best interest of all stakeholders. Randy and the team have been great team members throughout the past years, and I would like to thank them all for that. As one of the world's greatest games developers, I am confident that Gearbox will continue to innovate and thrive in their new home within Take-Two," says Lars Wingefors, co-founder and CEO of Embracer.

"As a significant long-term Embracer Group shareholder, I believe in the strategy for the Embracer Group going forward and am completely convinced that this transaction is the best possible scenario and an obvious net positive arrangement for Embracer Group, for Take-Two and, of course, for Gearbox Entertainment. My primary interest is always Gearbox, including our talent and our customers. I want to personally ensure fans of our games that this arrangement will ensure that the experiences we have in development at Gearbox will be the best it can possibly be," says Randy Pitchford, founder and CEO of Gearbox Entertainment.

Transaction key components
 

  • The purchase price on a cash and debt free basis and assuming a normalized level of working capital amounts to USD 460 million (SEK 4.9 billion) and will be subject to adjustments by customary purchase price mechanics.
  • The consideration at closing will be paid 100% in newly issued Take-Two shares. The number of Take-Two shares will be calculated by dividing the purchase price by the volume weighted average closing price per share on the Nasdaq Global Select Market during the five trading day period ending on the trading day immediately prior to the closing date. Embracer's intent is to sell these shares to receive cash proceeds soon after closing. Closing is expected in Q1 FY 24/25, ending June 2024.
  • Following purchase price adjustments, transaction costs, share sell-down and earnout settlements (including earnouts earned and due to be previously paid in Q1 FY 24/25) the expected net cash proceeds amount to approximately USD 300-330 million (SEK 3.2-3.5 billion).
  • Cash earnouts in accordance with non-GAAP will be reduced by SEK 1.6 billion compared to the group total of SEK 6.3 billion as of Q3 FY 2023/24 and of a total maximum of approximately 30 million B shares in share earnout obligations approximately 18 million B shares will be reduced. In connection with closing, the remaining approximately 12 million B shares will still be issued as settlement of certain earnout obligations.
  • The divested assets include:
    • Gearbox Software (Frisco, Texas)
    • Gearbox Montréal
    • Gearbox Studio Quebec
    • Borderlands and Tiny Tina's Wonderlands franchises, as well as Homeworld, Risk of Rain, Brothers in Arms and Duke Nukem
  • The retained assets include:
    • Gearbox Publishing San Francisco (to be renamed prior to closing, formerly named Perfect World Entertainment), including the publishing rights to the Remnant franchise, the upcoming Hyper Light Breaker and other notable unannounced game releases
    • Cryptic Studios, including MMO titles Neverwinter Online and Star Trek Online.
    • Lost Boys Interactive
    • Captured Dimensions
  • The retained companies will be welcomed and integrated into other parts of Embracer Group in the coming period. All companies are expected to contribute with a positive cash flow going forward.

Embracer continues to embrace new levels of completely warranted comeuppance. 

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Posted

A sale of $460 million on a company they previously valued at $1.3 billion on original purchase…

Great-Success.gif

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