Embracer Group will be divided into three companies. 4A Games will not be sold to Russians

Embracer Group has announced plans to split into three separate publicly traded companies focused on gaming and entertainment. The new companies will be named Asmodee Group, Coffee Stain & Friends and Middle-earth Enterprises & Friends. The Ukrainian studio 4A Games, owned by Embracer, will become part of Middle-earth Enterprises & Friends, where it will continue to work on AAA projects. It was previously reported that Saber intended to take over 4A Games, but this has not yet happened.

Middle-earth Enterprises & Friends will bring together renowned studios such as Crystal Dynamics, Dambuster Studios, Eidos-Montréal, Flying Wild Hog Studios, Tripwire, Vertigo Games, Warhorse Studios and 4A Games. The company’s intellectual property includes franchises such as Dead Island, Killing Floor, Kingdom Come Deliverance, The Lord of the Rings, Metro, Tomb Raider and many others. The group will also include PLAION, Freemode, Dark Horse and other companies.

Asmodee Group, Coffee Stain & Friends and Middle-earth Enterprises & Friends will operate as separate publicly traded companies. This will allow each company to focus on its strategic objectives and offer clearer equity stories to shareholders. The separation will also enable the companies to extract value from Embracer Group’s high-quality assets following completion of the restructuring program.

The shares of Asmodee Group and Coffee Stain & Friends are required to be distributed as dividends to Embracer Group shareholders and listed on Nasdaq Stockholm in accordance with regulatory rules. Middle-earth Enterprises & Friends is planned to remain part of the current Embracer Group company, which will subsequently be renamed. As part of the spin-off process, Embracer Group, through Asmodee Group, has entered into a new financing agreement worth €900 million. Proceeds from the financing will be used to repay existing debt and reduce leverage in the remaining Embracer Group.