Embracer is reportedly considering selling Gearbox, developer of the Borderlands franchise.
As reported by Video Games Chronicle, Reuters discovered that this is one of the options Embracer has on the table, though this doesn’t mean that a sale will actually go through.
Embracer made the shock announcement that they would be restructuring after a potential deal with a major client fell through. Apparently, that deal was with the Savvy Games Group, a company funded by the Saudi government.
Embracer Group had spent the last two years on an acquisition spree of multiple game studios. These were mostly smaller game companies, but still valuable, in particular thanks to their IP. Based on these acquisitions alone, they rapidly made themselves one of the biggest game companies in the world, rivaling the likes of Electronic Arts.
Embracer has faced some criticism for these business practices, accused of growing too big with no regard for sustainability. But the situation was marginally different when Embracer originally embarked on this journey.
At the time, they seemed to have brought back the THQ name, via THQ’s acquiring company, Nordic Games. Embracer’s games under THQ Nordic, and also outside of it, comfortably fit the mid-tier , A, and AA class of video games. These games were not as sprawling and ambitious as AAA projects. But, they were also cheaper to make and easy to make a profit off of.
Under these terms, these companies coming together under a larger parent company seemed advantageous. They could rely on safety in numbers to protect them from suddenly closing if one of them individually experienced a financial crisis. Of course, now we see the flip side of that, as Embracer may now be closing a few of these studios.
Gearbox Software, of course, is unlikely to be closed by Embracer. Even if some fans were not as happy with Borderlands 3, they continue to be one of the biggest game studios around. Their latest release did still sell over 18 million copies. They were acquired by Embracer for $ 1.4 billion, and if push came to shove the company is likely capable of buying themselves out.
The studio’s next upcoming release is Homeworld 3, the long awaited sequel being developed for Gearbox by Blackbird Interactive. Embracer is more likely to want to keep Gearbox on, as one of their more reliable cash cows. But of course, if everything turns sideways, Embracer may be forced to sell just to stay afloat. At least for now, they can afford not to choose that, and can hope that they can eventually turn everything around in the future.
