Embracer Group shares take a dive after $2 billion deal unexpectedly collapses

Embracer has been aggressively picking studios and IP, but recently reported the failure of a $2 billion USD deal in its recent financial report.

Image via Embracer Group

Embracer Group shares are down this week after the company revealed in recent financial reporting that it had an unannounced $2 billion USD deal unexpectedly collapse. The company’s interim Q4 2023 report shared some details of the failed deal and, almost immediately following the report, Embracer’s share price dropped by over 40 percent. The deal’s failure was a surprise to Embracer leadership and its Board of Directors.

Word of this unannounced deal’s failure was published in Embracer Group’s interim Q4 2023 financial report on the company’s investor relations website on May 24, 2023. The company that pulled out of the deal is unnamed, but it was a substantial and unexpected loss for Embracer.

Embracer Group interim Q4 2023 report with a statement on a failed $2 billion deal.
Embracer Group's interim Q4 2023 financial report disclosed the unexpected failure of a $2 billion deal, causing share price to drop.
Source: Embracer Group

Embracer goes on to say that the so-called “groundbreaking strategic partnership” was on the verge of being announced in the company’s Q4, but suddenly the other side pulled out and canceled the deal.

The Embracer Group has been very aggressive in its acquisition of studios and IP over the course of the last several years. In 2022, the company went on a $576 million USD spree of acquisitions. That spree ended up with Embracer holding the keys for popular publishers and developers like Tripwire Games and Limited Run Games. It also got the rights to the Lord of the Rings and Hobbit IPs and recently announced that it would be working with Amazon Games on a new Lord of the Rings MMO.

Nonetheless, the failure of Embracer Group’s unnamed $2 billion deal is likely to hamper its business a bit. With the company currently reeling from the loss, it will be interesting to see what comes next. Stay tuned as we watch for updates.

Senior News Editor

TJ Denzer is a player and writer with a passion for games that has dominated a lifetime. He found his way to the Shacknews roster in late 2019 and has worked his way to Senior News Editor since. Between news coverage, he also aides notably in livestream projects like the indie game-focused Indie-licious, the Shacknews Stimulus Games, and the Shacknews Dump. You can reach him at tj.denzer@shacknews.com and also find him on Twitter @JohnnyChugs.

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