Embracer Details Coffee Stain Spin-Off and Unveils Future Name

Alongside its preliminary Q4 figures, Embracer has announced plans for the next phase of the split revealed in 2024. By the end of the year, Coffee Stain Group is to be spun off as an independent company. The new name of the remaining Embracer Group, which also includes Plaion, DECA and THQ Nordic, will be Fellowship Entertainment — not Middle Earth & Friends, which was the working title.

Embracer Group has finalised its restructuring roadmap for 2025. As announced in April 2024, the group will ultimately be divided into three separate entities. Following the completion of the separation from Asmodee in February, a timeline has now also been set for Coffee Stain Group, which is expected to operate independently by the end of the 2025 calendar year.

Shares in Coffee Stain Group will be distributed to Embracer shareholders, and the new stock will be traded on the Nasdaq First North Premier Growth Market in Stockholm. At the same time, the Embracer Group — along with all remaining units — will be renamed to signal a new beginning. The previous working title for the smaller group, Middle Earth & Friends, will be dropped. Instead, the entity will operate under the name Fellowship Entertainment.

“We’re really proud of everything we’ve built as part of Embracer, and grateful for the support and trust we’ve received over the years. Now, as we take the step to become a separately listed company, it feels both exciting and, honestly, a little bit scary — but in a good way,” says Anton Westbergh, co-founder and Group CEO of Coffee Stain.

Lars Wingefors, co-founder and Group CEO of Embracer, adds: “Coffee Stain Group has incredible talent, IPs and communities. To date, it has been a true recipe for success. I am confident in Anton’s strategy and leadership and see a clear long-term opportunity in attracting and enabling partnerships with like-minded independent game developers and talents.”

Coffee Stain Group will comprise more than 250 people. It will include Coffee Stain, Ghost Ship, and Tuxedo Labs, as well as selected studios from Amplifier Game Invest, all based in Scandinavia. Anton Westbergh will serve as Group CEO.

Fellowship Entertainment will have approximately 6,000 employees across more than 30 countries. It will hold the commercial rights to J.R.R. Tolkien’s The Hobbit and The Lord of the Rings, along with IPs such as Kingdom Come: Deliverance, Dead Island, Killing Floor, Darksiders, Remnant, and Tomb Raider, among over 300 other gaming properties.

Fellowship Entertainment will include more than 40 companies, such as Plaion, Deca Games, and THQ Nordic, all based in the GSA region. Other companies within Fellowship Entertainment include Aspyr Media, Crystal Dynamics, Dambuster Studios, Dark Horse, Eidos-Montréal, Flying Wild Hog, Gunfire Games, Limited Run Games, Middle-earth Enterprises, Milestone, Tripwire Interactive, Vertigo Games, and Warhorse Studios, among others.

Alongside its structural plans, Embracer also presented preliminary Q4 and full-year results, which were naturally influenced by the ongoing consolidation. Net revenue declined by 18 per cent to SEK 22.37 billion. Part of the decline was due to asset sales. Organic revenue fell by nine per cent, according to the company. EBIT reached SEK 3.5 billion, a significant recovery from a loss of SEK 14.4 billion the previous year. The workforce was reduced from 9,692 to 7,180 employees.

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