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Embracer Group, the gluttonous video game giant, makes mass redundancies: many games on the chopping block
The rise and fall of a European video game giant? Let's hope it's only temporary.
If the name Embracer Group doesn't ring a bell, it's hardly surprising that the company is so young. Indeed, it was only in 2019 that THQ Nordiq AB was renamed Embracer Group. In reality, the company was founded under the name Nordic Games, first created in 1990 before going bankrupt in 2004, then relaunched with greater success in 2008. Within three years, the company had grown in size, and was able to expand internationally with acquisitions that were not necessarily very costly, but rather significant, such as THQ, which was in bankruptcy at the time.
The company then embarked on an acquisition frenzy, acquiring Koch Media and, with it, publisher Deep Silver in 2018. This was followed by the absorption of Coffee Stain Holding, Game Outlet Europe and Goodbye Kansas Game Invest, the latter providing minority stakes in several video game development studios, Palindrome Interactive, Fall Damage, Neon Giant, Kavalri Games and Framebunker. THQ Nordiq then became Embracer Group, but that didn't stop the acquisition frenzy - on the contrary. Tarsier Studios, Saber Interactive, 4A Gamers, New World Interactive, Rare Earth Games, Vermila Studios, Pow Wow Entertainment, DECA Games joined the group before even bigger purchases were made in 2021: Gearbox Software for $1.3 billion, Easybrain for $640 million and Aspyr Media for $450 million.
The end of 2021 and the year 2022 show no signs of slowing down the machine: board game specialist Asmodee is acquired on December 17, 2021 for $3 billion, and a few days later Dark Horse Media joins Embracer Group. In 2022, Crystal Dynamics, Eidos Montréal and Square Enix Montréal were absorbed, before Middle-Earth Enterprises was bought out in mid-2022. From then on, things began to calm down, and just as the video game world seemed set to enter a turbulent period, Embracer Group began a phase of reorganizing its countless acquisitions. The Volition studio, which had been in existence for over a quarter of a century, was closed on August 31, 2023.
Today, with the publication of its quarterly financial report, Embracer Group has further clarified the contours of this reorganization. No fewer than 900 positions - or 5% of the company's workforce - have been eliminated. As a consequence, Embracer Group has cancelled fifteen game projects scheduled for release between March and September 2024, most of which have not even been officially announced yet. What's more, a partnership project with Savy Games Group - a Saudi investment fund that was supposed to put $2 billion on the table - has fallen through, and Embracer Group is already looking to get rid of Gearbox Software, which it bought less than two years ago. It doesn't look good...