For many years, it seemed like the Embracer Group (owner of Borderlands, Tomb Raider and The Lord of the Rings, among others) made a new spectacular acquisition every month while vacuuming the gaming market for both classic game series and game companies (both developers and publishers). Recently, however, things have been much quieter, and during 2023 the share price has been more like a steep slalom hill – and today it has been a sheer cliff.
The problem is that the company is now confirming that it missed out on a deal worth $2 billion overnight. Embracer writes in one statement:
“We have worked on a groundbreaking strategic partnership agreement that would have set a new standard for the gaming industry.
Negotiations have taken much longer than originally anticipated considering we had a verbal commitment as early as October 2022. That specific agreement included more than $2 billion in contracted development revenue over a six-year period.”
They go on to explain what happened next during the night:
“All documentation was completed and ready as of yesterday. We requested the completion of the agreement prior to the announcement in the fourth quarter. However, late last night we received a negative response from the counterparty. This decision was unexpected for the management and board of Embracer.”
As a result of this and significantly downgraded results, the share price has now fallen by over 45% at the time of writing. An upswing can possibly be expected tomorrow, but it is clear that the Swedish giant will have a tougher year ahead.
2023-05-24 19:32:43
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