Reports have emerged that Embracer Group are exploring the sale of Gearbox, as the once omnivorous publisher holding company continues to undergo a large-scale restructuring program after a $2 billion investment deal fell through earlier this year.
As reported by Reuters, Embracer Group are considering all options for Gearbox including a sale, per three people familiar with the matter. Embracer has apparently already received interest from some third parties, and is reportedly working with Goldman Sachs and Aream & Co. to explore a sale. They do caution that these are not advanced talks and could still come to nothing.
Of all Embracer’s many sub-divisions, selling off Gearbox could make the most sense, given the company’s links and ties to other publishers and tangled web of IP and licensing. The Borderlands series and its spin-offs, for example, are published by 2K Games and not by Gearbox themselves, and this series remains the jewel in the company’s crown. They also own the Homeworld franchise, though the third game is in development with private studio Blackbird Interactive, and have been publisher on indie hits like Remnant II, Hyper Light Breaker, Risk of Rain 2 and more.
The Gearbox umbrella has grown in the last few years, opening a Canadian studio in August 2021, acquiring Lost Boys Interactive, who had supported Tiny Tina’s Wonderlands during development, absorbing Perfect World Entertainment and Cryptic Studios as they were acquired, and Eidos Shanghai (now Gearbox Studio Shanghai) and for the last 10 months, taking control of Saints Row developer Volition. Oh, and there’s the movie-making venture as well. The company headcount has ballooned from around 600 in April 2021 to 1,300 just a year later.
Embracer Group acquired Gearbox back in April 2021 for $1.3 billion. As part of the deal Gearbox founder and CEO Randy Pitchford continued to lead the new operating group and Gearbox employees became “significant” shareholders in Embracer as well.
“Gearbox is arguably one of the most creative and valuable independent developers in the world. We believe that the resources offered by Embracer will position Gearbox for continued significant growth in the years to come” saaid Lars Wingefors, Founder and Group CEO of Embracer Group at the time.
What’s not clear is how Embracer now values the Gearbox group and the IP. They’ve dramatically inflated the headcount in the last two years, and they’ve added more IP like Risk of Rain and Remnant to its catalogue in that time alongside Borderlands, Duke Nukem and Homeworld. But again, while Gearbox owns the Borderlands IP, the games are permanently tied to a publishing deal with 2K Games.
With that in mind, you’d have to say 2K Games and parent Take-Two would be the most likely traditional publisher buyer for Gearbox. Them or, having plunged Embracer into this situation by backing out of that investment deal, the Saudi PIF (under the guise of Savvy Gaming Group) could grab Gearbox outright.
Source: Reuters
