Embracer Group reveals plan to split up into three separate companies

Say hello to Asmodee Group, Coffee Stain & Friends, and Middle-earth Enterprises & Friends.

Embracer Group
7

Embracer has been in the news cycle for a while now, but it appears that today’s news might be of the good kind. The company, which appeared to be having some financial problems, has announced it would be splitting into three distinct, publicly listed companies, each with their own focus on a core strategy.

On April 22, 2024, Embracer Group announced its intention to split into three publicly listed entities. These entities include Asmodee Group, Coffee Stain & Friends, and Middle-earth Enterprises & Friends. The announcement on the official releases section of the Embracer site highlights a few key components of this process:

  • Shares of Asmodee Group (“Asmodee”) and “Coffee Stain & Friends” are intended to be distributed as a dividend to the shareholders of Embracer Group and listed on Nasdaq Stockholm, in accordance with the Lex ASEA rules. “Middle-earth Enterprises & Friends” is intended to remain within the current listed company Embracer Group, which will subsequently be renamed.
  • The listing and distribution of shares (the “distribution” or “spinoff”) in Asmodee is expected to take place within 12 months and the listing and distribution of shares in “Coffee Stain & Friends” during calendar year 2025.
  • As part of the Asmodee separation process, Embracer Group has, through Asmodee Group, entered into a new financing agreement amounting to EUR 900 million. The proceeds from the financing are used to repay existing debt and reduce leverage in the remaining Embracer Group. As announced today and further detailed in a separate press release available at embracer.com/investors.
  • As part of the transformation and ahead of each separation the full capital structure, including both equity and debt, will be reviewed in Asmodee and “Coffee Stain & Friends” to create the best possible long-term foundation for each entity as a separately listed company.
  • The largest shareholder, Lars Wingefors AB, intends to form a new long-term ownership structure, including the current holdings in Embracer Group (approximately 20% of capital and 40% of votes), and will remain a long-term, active, committed and supportive owner of all three entities.
  • Shareholders representing more than 50 percent of the capital and votes in Embracer Group have expressed support for the transformation plan.

Interestingly, not all of these companies will be focused entirely on video games. Asmodee Group is expected to be a global leading tabletop games publisher and distributor. As for Coffee Stain & Friends and Middle-earth Enterprises & Friends, it sounds as though these two will be handling the more traditional video game ventures.

Ahead of the initiation of the separation process of Asmodee and in line with already planned governance evolutions, Stéphane Carville, current CEO, and Marc Nunes, current COO and founder, will join and play active roles in the Board of Directors of Asmodee. Thomas Koegler, a longstanding operational and executive leader at Asmodee and current deputy COO, will in the coming months become Asmodee CEO supported by key leaders within Asmodee.  For “Coffee Stain & Friends”, Anton Westbergh, current CEO of the operative group Coffee Stain, will take the leading role in the process leading up to the separation. The Operative Group CEOs of DECA Games, Easybrain, Amplifier Game Invest and THQ Nordic will report to Anton Westbergh starting April 22, 2024.  For “Middle-Earth Enterprises & Friends”, Phil Rogers will take the leading role in the process leading up to the separation. Phil Rogers is currently interim Group Chief Strategy Officer, with responsibility for the concluded restructuring program, and CEO of the operative group Crystal Dynamics – Eidos. The Operative Group CEOs of PLAION, Dark Horse and Freemode will report to Phil Rogers starting April 22, 2024.  Stéphane Carville (until the nomination of Thomas Koegler as Asmodee CEO in the coming months), Anton Westbergh and Phil Rogers are by April 22, 2024 appointed to the executive management of Embracer Group. The executive management of Embracer Group AB will by April 22, 2024 consist of Lars Wingefors (Group CEO), Johan Ekström (Group CFO and deputy CEO), Careen Yapp (Chief Strategic Partnership Officer), Ian Gulam (Chief of Staff, Legal & Governance), Anton Westbergh, Phil Rogers and Stéphane Carville.

Source: Embracer Group

Coffee Stain & Friends will have two priorities: indie and A/AA games. These games will be both premium and free-to-play across PC, console, and mobile devices. Meanwhile, Middle-earth Enterprises & Friends will focus entirely on AAA titles that utilize various intellectual properties including The Lord of the Rings and Tomb Raider.

Kicki Wallje-Lund, Chair of the Board of Embracer Group, notes that this splitting into three separate groups should allow the companies to focus more on a core strategy and leverage their individual strengths.

As mentioned above, Embracer Group has been having a rough time. Recently, the company sold Gearbox Entertainment Company to Take-Two Interactive for $460 million after merging with it in 2021 as part of a $1.3 billion USD deal. Prior to that, Embracer also sold Saber Interactive for $247 million, which took place after five months of layoffs between July and December 2023 where 1,400 employees lost their jobs.

Now that Embracer Group is splitting into three smaller companies, hopefully we start to see some positive news about the projects currently in development. Be sure to keep it locked to Shacknews as we bring you the latest on Asmodee Group, Coffee Stain & Friends, and Middle-earth Enterprises & Friends.

Guides Editor

Hailing from the land down under, Sam Chandler brings a bit of the southern hemisphere flair to his work. After bouncing round a few universities, securing a bachelor degree, and entering the video game industry, he's found his new family here at Shacknews as a Guides Editor. There's nothing he loves more than crafting a guide that will help someone. If you need help with a guide, or notice something not quite right, you can message him on X: @SamuelChandler 

From The Chatty
  • ? reply
    April 21, 2024 11:15 PM

    Sam Chandler posted a new article, Embracer Group reveals plan to split up into three separate companies

    • ? reply
      April 22, 2024 5:34 AM

      Fools, should have called it Left Embracer, Right Embracer, and Front Embracer all under the umbrella company, Group Hug

      • ? reply
        April 22, 2024 8:11 AM

        Who forms the head?

        • ? reply
          April 22, 2024 9:17 AM

          Current CEO Will own all 3, and remain a group CEO over all

          • ? reply
            April 22, 2024 1:41 PM

            Shuffling chairs on the deck of the Titanic.

    • ? reply
      April 22, 2024 5:34 AM

      seems like they finally made the Embracer name radioactive enough to have to change it to something else. nice work lol

    • ? reply
      April 22, 2024 5:38 AM

      What the hell was or is this company’s strategy?

      Buy game studios.

      Lose a lot of money. Sell off or shutter the studios

      Break apart

      • ? reply
        April 22, 2024 5:51 AM

        When interest rates were low a lot of companies had no real plan other than to spend their way to success.

      • ? reply
        April 22, 2024 8:57 AM

        they got fucked in an investment deal. it's their fault for sure, but this wasn't the plan

      • ? reply
        April 22, 2024 10:53 AM

        Their strategy was to get 6B in saudi funding that fell through

      • ? reply
        April 22, 2024 1:49 PM

        While it is easy to blame this one, dumb company it looks an awful lot like a whole bunch of owners of game companies actually all just wanted a cash out at once and Embracer is the unfortunate bag holder.

      • ? reply
        April 22, 2024 3:22 PM

        Probably a bunch of MBAs just got together and figured they could smart their way into being rich.

    • ? reply
      April 22, 2024 10:55 AM

      They’re doing the reverse T-1000.

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