Embracer Group has entered into an agreement to acquire Crystal Dynamics, Eidos-Montréal and Square Enix Montréal from Square Enix along with an intellectual property catalog that includes Tomb Raider, Deus Ex, Thief and more than 50 others.
The Embracer Group pays $ 300 million for these studios and associated IPs and does so on “no cash and no debts to be paid in full at closing”, according to the company. In total, this acquisition will result in approximately 1,100 employees from these three studios, in eight locations around the world, becoming employees of the Embracer Group. This purchase is expected to end in the second year of the financial year of Embracer 2022-23, or in other words, sometime between July and September this year.
“We are excited to welcome these studios to the Embracer Group,” said Lars Wingefors, co-founder and CEO of the Embracer Group. “We recognize the fantastic IP, world-class creative talent and experience of excellence that have been demonstrated time and time again in recent decades. It was a great pleasure to meet with leadership teams and discuss future plans on how to realize their ambitions and become a great part of Embracer. ”
Square Enix CEO for America and Europe Phil Rodgers said in a statement that Embracer is the best kept secret in gaming, as it is “a huge, decentralized collection of entrepreneurs we are excited to be a part of today.” He called the Embracer Group ideal for Square Enix America and Europe’s ambitions, which is to “make high-quality games with great people, sustainably and develop our existing franchises to their best.”
As Embracer acquires not only Crystal Dynamics but also Tomb Raider IP, it looks like the next Tomb Raider game, which was announced just a few weeks ago as a title to be developed entirely in Unreal Engine 5, will be Embracer. As to why Square Enix decided to sell these studios as a start, which includes the studios behind Marvel’s Avengers and Marvel’s Guardians of the Galaxy, Square Enix cites “adapting to changes in the global business environment” and the rise of blockchain technology, cloud games and artificial intelligence and their own investment in each.
“The transaction will help the company adapt to changes in the global business environment by establishing a more efficient allocation of resources that will increase corporate value by accelerating growth in the company’s core digital entertainment business.” Enix in his own edition. “In addition, the transaction provides an opportunity to start a new business, moving forward with investments in areas such as blockchain, AI and the cloud.
Reading a bit between the lines, Square Enix indicated that at times he was not impressed with his western studio’s production, calling Crystal Dynamcis’s Marvel’s Avengers a disappointment in November and saying that Marvel’s Guardians of the Eidos-Monreal Galaxy missed the initial your expectations despite strong reviews.
Going forward, Square Enix says that its studios in Japan, outdoor studios Square Enix and Square Enix Collective will continue to make games, and the company will continue to “publish franchises such as Just Cause, Outriders and Life is Strange.
Following the transaction later this year, the Embracer Group says the United States will be its number one country in terms of the number of game developers, with Canada in second place.
“In total, after the pending closures, Embracer will have more than 14,000 employees, 10,000 engaged game developers and 124 in-house studios,” the statement said. “Embracer’s upcoming content system includes more than 230 games with more than 30 AAA games. This acquisition will bring additional scale to Embracer’s current AAA segment, and Embracer will have one of the largest content pipelines for computer / console games in the industry, in all genres.
The company says it believes there will be a growing demand for “high quality content, including AAA single player games” over the next decade, and the transaction will help it meet that demand.
The acquisition of the Embracer Group joins a number of other acquisitions that have largely determined the 2022 Games so far. It started with Take-Two Interactive, the parent company behind the Grand Theft Auto series, which announced back in January that it was acquiring mobile giant Zynga for nearly $ 13 billion. Then, a week later, Microsoft announced it was acquiring Activision Blizzard, the company behind Overwatch and Call of Duty, for a whopping $ 68.7 billion, and two weeks later, Sony revealed it was buying Bungie for 3.6 billion dollars. A few weeks later, Sony also announced that it had acquired Jade Raymond’s new studio, Haven Studios.
Despite the increase in acquisitions this year, Embracer Group has been increasing the number of its studios for years. For example, it acquired World War Z Saber Interactive in 2020, and then in 2021, Embracer Group acquired Perfect World Entertainment and Dark Horse Media.
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