Asmodee Owner To Split Into 3 Companies

Publisher of video games, Star Wars TTRPG, and owner of Middle Earth Enterprises restructures after turbulent year.

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Embracer Group, the Swedish gaming conglomerate which owns Asmodee, a major French tabletop gaming company with names like Days of Wonder, Ticket to Ride, Fantasy Flight Games, and various Lord of the Rings games--along with and Dark Horse Comics, Edge Studios, a subsidiary which produces the current range of Star Wars TTRPG books, and Fantasy Flight Games--is to split into three companies, the company has announced. Embracer Group owns or controls over 9,000 different IPs, including Middle Earth Enterprises, which it acquired in August 2022.

The company has been going through a rough time, with hundreds of layoffs, the closures of various studios like Saints Row developer Volition and Timesplitters' Free Radical Design, and the sales of developers such as Saber Interactive, which made the Star Wars: Knights of the Old Republic remake, and Gearbox Entertainment, which makes Borderlands and Duke Nukem. Restructuring began in June 2022, with 1,387 staff laid off, represents 8% of the company's worldwide workforce. 29 unannounced games were also cancelled, as was a new Deus Ex game. The financial turmoil was caused by the breakdown of a $2B deal with Savvy Games Group, a Saudi government funded company.

“The Board of Directors of Embracer Group AB (“Embracer Group”) today announces a transformative step for value creation through a separation of the group into three market-leading games and entertainment companies: Asmodee Group, “Coffee Stain & Friends” and “Middle-earth Enterprises & Friends”. The three entities will be separate, publicly listed companies, enabling each entity to better focus on their respective core strategies and offer more differentiated and distinct equity stories for existing and new shareholders. This will enable the entities to unlock value in the high-quality assets of Embracer Group following the successful completion of the restructuring program.”


The three new companies are:
  • Asmodee (tabletop gaming)
  • Coffee Stain & Friends (premium and free-to-play PC, console, and mobile gaming)
  • Middle-earth Enterprises & Friends (AAA games, LotR content, plus Dark Horse Comics and Tomb Raider)
As part of the restructuring, Asmodee has secured €900M in financing, which most are speculating is a way to spin off Embracer's debts of over $700M--the press release says that "The loan is ringfenced with no recourse to Embracer Group… it is only secured by Asmodee assets". All three companies will remain controlled by Embracer CEO Lard Wingefors, who owns about 20% of Embracer's capital and controls 40% of votes. Embracer says that "Wingefors will “remain a long-term, active, committed and supportive owner of all three entities."

Edge Studios, which holds the TTRPG titles previously produced by sister-sute Fantasy Flight Games, is known for TTRPGs such as Arkham Horror, Legend of the Five Rings, Midnight, and Star Wars (along with the Genesys universal game system). These titles will be produced by the new Asmodee company.

Asmodee will be spun off within the next 12 months, with Coffee Stain moving during 2025. Asmodee in its current form, which Embracer acquired in March 2022, produces over 300 well-known tabletop games such as Ticket to Ride, Catan, and Exploding Kittens, with licensed tabletop games based on Lord of the Rings, Marvel, Lego, and Star Wars in development.

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Embracer Group AB (”Embracer Group”) has, as part of its decision to transform the group into three separate publicly listed entities, which is further described in a separate press release announced today, entered through Asmodee into a financing agreement with JP Morgan, BNP Paribas, SEB, Societe Generale and Swedbank. The financing amounts to EUR 900 million (approximately SEK 10.5 billion) with a maturity up to 18 months and on similar terms as the previous loan. The financing agreement creates a strong foundation for building an optimal capital structure for the three entities.

The financing is an important part of the debt refinancing of Embracer Group following its restructuring program, which was finalized 31 March, 2024. The loan at Asmodee level has a maturity up to 18 months on similar terms as Embracer Group’s existing SEK 8 billion loan with maturity in February 2025. The loan is ringfenced with no recourse to Embracer Group, separating Asmodee’s assets and funds from those of Embracer Group, and it is only secured by Asmodee assets. The loan will be used to refinance Embracer Group’s existing SEK 8 billion loan with maturity in February 2025, and to reduce the revolving credit facilities by SEK 1 billion to SEK 8 billion. The previously communicated mandatory amortization of SEK 2.6 billion until January 2025 is no longer needed due to the repayment of the SEK 8 billion loan with maturity February 2025. The existing revolving credit facilities mature in May 2025.

The intention is to continue to deleverage, through both the expected significantly improved Free Cash Flow in the remaining Embracer Group (excluding Asmodee), as well as the proceeds from the divested assets of Saber Interactive and Gearbox Entertainment in the course of FY24/25.

On a pro forma basis as per LTM[1] December 2023, Embracer Group, including the expected sales proceeds from the divestment of assets from Saber Interactive and Gearbox Entertainment, but excluding Asmodee, will have a Net Debt-to-Adjusted EBIT of around 0.6x. On a pro forma basis as per LTM December 2023, Asmodee will have a Net Debt to Adjusted EBITDA of approximately 3.9x. As part of the transformation and ahead of each separation the full capital structure, including both equity and debt, will be reviewed in Asmodee and “Coffee Stain & Friends” to create the best possible long-term foundation for each entity as a separately listed company.
 

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I had no idea ‘deleverage’ was a word.
I somehow managed to read that as "decleavage" at first, and was wondering if it was the term for touching up artwork to tone down the amount cheesecake in evidence.

Fun trivia, "cleavage" used to be largely a term used only in mineralogy and geology in the early 1800s, followed by a more general definition of "the action of cleaving or being cleft" by the 1860s. We can blame Joseph Breen (of Hays Code fame) for its more anatomical definition, as he originally applied the word to Jane Russell's costumes in 1943 and the usage spread from there.
 

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Minicol

Adventurer
Supporter
Hmmm...maybe Admodee could save some money by moving their HQ from Guyancourt (Paris Suburb, which I expect is quite expensive) to their location (previous HQ of Fantasy Flight Games) in Roseville, Minnesota. :)

Though probably more likely that we'll see Asmodee North America closed down and folks laid off. :-(
Man Guyancourt !!! LOL !!! Can't easily think of worse places in the country.
 

Eyes of Nine

Everything's Fine
I mean, the licensing dispute that killed Netrunner would become moot. The non profit fan collective running it now is doing great, but it's crazy that such a cult favorite was allowed to die in the first place.
There are probably a few or a lot of product synergies and maybe some attractive licenses; but I'm thinking more like "they have a capability that we don't have AND that we want" such as VTT expertise; or video game expertise (not in Asmodee, the other divisions got those).
 


Pedantic

Legend
Unlike the paradise that is Roseville, MN; famous as the birthplace of Target and, uh, the largest outdoor refrigerated sheet of ice in North America. :-\
So I used to vacation to Roseville once a year for the Netrunner World championships.... in October.

The best I can say is that the city has decent food, everything is pretty cheap, and the FFG game center (now the Gamezenter, once again owned by FFG founder Christian T. Petersen) is legitimately nice. If you're planning to stay in and play board games anyway, you could do worse.
 

MNblockhead

A Title Much Cooler Than Anything on the Old Site
So I used to vacation to Roseville once a year for the Netrunner World championships.... in October.

The best I can say is that the city has decent food, everything is pretty cheap, and the FFG game center (now the Gamezenter, once again owned by FFG founder Christian T. Petersen) is legitimately nice. If you're planning to stay in and play board games anyway, you could do worse.
Gamezenter is definitely the best thing about Roseville (I mean, if you are a gamer). The next best thing about Roseville is that it's convenient to get into both Minneapolis and St. Paul, where all the good dining is at.
 



So I used to vacation to Roseville once a year for the Netrunner World championships.... in October.

The best I can say is that the city has decent food, everything is pretty cheap, and the FFG game center (now the Gamezenter, once again owned by FFG founder Christian T. Petersen) is legitimately nice. If you're planning to stay in and play board games anyway, you could do worse.
Honestly, that sounds like heaven compared to the wargaming cons I'm used to attending in Lancaster PA. You had me at "decent food" and "pretty cheap" already, a nice venue is just gravy after you've gamed at the Host.
 


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