Embattled Game Publisher Embracer Group Splits Into Three Companies, But Will It Save Them?

Embattled Game Publisher Embracer Group Splits Into Three Companies, But Will It Save Them?

Embracer Group is splitting into three separate publicly listed companies to “continue the transformation,” as announced by the Board of Directors today.

The embattled company is set to split into Asmodee Group, Coffee Stain & Friends, and Middle-earth Enterprises & Friends. According to the official press release, the split will enable “each entity to better focus on their respective core strategies.” Middle-earth Enterprises & Friends will remain within the current listed company Embracer Group, which will be renamed. 

Editor’s note: I personally think its really funny of the company that owns the rights to The Lord of the Rings to split itself into three. Just putting that out there. — David.

According to the release, the listing and distribution of shares in Asmodee will take place within the next 12 months, while Coffee Stain & Friends will be listed and shares distributed during the 2025 calendar year. Embracer Group has also entered into a new financing agreement through Asmodee Group which amounts to $900 million EUR, with the proceeds from this used to repay existing debt and “reduce leverage in the remaining Embracer Group.”

The Board of Directors have opted to split Embracer into three after a “careful and thorough review” which found the current structure “does not create optimal conditions for future value creation both for Embracer Group’s shareholders and other stakeholders.”

Asmodee is described as a “global leading tabletop games publisher and distributor,” while Coffee Stain & Friends will serve as a “diverse gaming entity with a dual focus on indie and A/AA premium and free-to-play games” with “a high degree of recurring revenues” for PC, console and mobile (read: monetised out the wazoo). Middle-earth Enterprises & Friends will be Embracer Group’s AAA “creative powerhouse” and retain stewardship of The Lord Of The Rings and Tomb Raider IPs among others.

Chair of the Board of Embracer Group Kicki Wallje-Lund says the move will “position us for continued success in the future.” while co-founder and Embracer CEO Lars Wingefors has described it as “the start of a new chapter.”

Embracer Group has come under fire for an astronomical amount of lay-offs, studio closures and sales of acquired companies such as Gearbox (which they sold to Take-Two for less than half of what they paid for it). 

It’s not yet clear if Embracer’s decision to split the party, so to speak, is a move to preserve the company from further financial strife in the wake of what’s been a horrific financial year isn’t clear. What’s even less clear is if the next phase of the company’s restructuring plans will yield success and stave off more closures, but it seems there’s at least an attempt to change the course from the group going completely bust and falling in a screaming heap all at once. Given the current trend of ‘restructuring’ as code for mass lay-offs, it’s possible that even if this change shores up Embracer Group, we may still be yet to see more job losses in an already struggling industry.

Whatever the case may be, it looks like Embracer Group will be no more come 2025 – at least in name.

Image: Embracer Group

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