Embracer Group CEO Lars Wingefors recently detailed that the company’s restructuring program has ended after the company shut down Volition and sold off Gearbox and Sabre Interactive.
A screenshot of Tiny Tina’s Wonderlands (2022), Gearbox Software
Wingefors announced the restructuring program back in June after a massive $2 billion deal collapsed in May. In an open letter, Wingefors explained the company’s plan, “The program is divided into different phases until March 2024 with focus on cost savings, capital allocation, efficiency and consolidation. The initial phase, which is initiated immediately, mainly targets cost savings across the group.”
He continued, “The next phase, which also starts immediately, will require further analysis to determine specific actions. The last phase will focus on internal consolidation, further resource utilization and more synergies across the Group. The actions for each affected company will be implemented by the new interim COO and CSO in collaboration with each operative group CEO and management teams.”
Later in the letter he detailed, “The actions will include, but not be limited to, closing or divestments of some studios and the termination or pausing of some ongoing game development projects. It will also include decreased spending on non-development costs such as overhead and other operating expenses. We will reduce third party publishing and put greater focus on internal IP and increase external funding of large-budget games.”
A screenshot from Warhammer 40,000: Space Marine 2 (2024), Saber Interactive
In March 2024, Embracer Group sold Gearbox Entertainment for $460 million to Take-Two Interactive Software, Inc. and it sold off Sabre Interactive to Beacon Interactive for $247 million. Beacon Interactive is controlled by Saber Interactive co-founder Matthew Karch, who was also Embracer Group’s Interim Chief Operating Officer.
During a Q&A portion of a press conference discussing the sale of Gearbox Entertainment, Wingefors stated, “This is the final structured divestment process under the restructuring program. Now, we are ending the restructuring program end of March and we are now looking into the future.”
A screenshot from Borderlands 3 (2020), Gearbox Software
Later in the Q&A, Wingefors also shared that the company will not be selling any more of its assets, “Obviously, we are ending the restructuring program now, end of March. So, there’s not many days left. And the Gearbox structure process has been part of that restructuring program. Now, you know, I’ve been getting approached and we are getting approached I would say if not by daily, but a weekly basis, by companies that would like to acquire certain assets within the group. And I’ve been very clear that they are not for sale because they are a very important part for the Group and the shareholders of the Group going forward.”
He added, “So that’s why we’re taking the more difficult route to actually divest businesses that has a negative cash flow, which is more difficult transactions, but makes the remaining part of Embracer more cash flow generative with a more clear focused strategy into the future.”
A screenshot from World War Z (2021), Sabre Interactive
What do you make of Wingefors comments?
