Embracer Group to be Split Into Three Parts

Following the "successful completion" of its restructuring programme, Embracer Group is to be split into three separate publicly listed companies.

The Board of Directors of Embracer Group announces the separation of the Group into three distinct games and entertainment companies: Asmodee Group, Coffee Stain & Friends (WT) and Middle-earth Enterprises & Friends (WT). The three entities will become separate, publicly traded companies in order to better focus on their respective core strategies. The transformation plan has been endorsed by shareholders representing more than 50 per cent of Embracer Group's capital and votes.

The transformation of the Embracer Group into three separate entities affects the GSA companies Deca (Berlin), Plaion (Munich/Höfen), and THQ Nordic (Vienna). Deca and THQ Nordic will be part of Coffee Stain & Friends (WT), Plaion will be part of Middle-earth Enterprises & Friends (WT). Further details here at GamesMarkt.

"The Board of Directors, together with executive management, propose to transform Embracer Group into three separate, listed companies. This transformation is an important step in unlocking shareholder value. With this new structure, the three entities will be able to focus on executing their core strategies and leveraging their own strengths, providing more differentiated and distinct equity stories to both existing and new shareholders. After careful evaluation of various strategic alternatives, we strongly believe that this decision will benefit all stakeholders and position us for continued success in the future", says Kicki Wallje-Lund, Chair of the Board of Embracer Group.

"Shares of Asmodee Group and "Coffee Stain & Friends" are intended to be distributed as a dividend to the shareholders of Embracer Group and listed on Nasdaq Stockholm, in accordance with the Lex ASEA rules," the Company says. "Middle-earth Enterprises & Friends" is intended to remain within the current listed company Embracer Group, which will subsequently be renamed. The listing and distribution of shares in Asmodee is expected to take place within 12 months and the listing and distribution of shares in "Coffee Stain & Friends" during calendar year 2025.

As part of the Asmodee separation process, Embracer Group has, through Asmodee Group, entered into a new financing agreement amounting to 900 million Euros with JP Morgan, BNP Paribas, SEB, Societe Generale and Swedbank. "The financing agreement creates a strong foundation for building an optimal capital structure for the three entities," the company states. The proceeds from the financing are used to repay existing debt and reduce leverage in the remaining Embracer Group. "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."

The largest shareholder, Lars Wingefors AB, intends to create a new long-term ownership structure including the current holdings in the Embracer Group (approximately 20 per cent of the capital and 40 per cent of the votes) and will remain a long-term, active, committed and supportive owner of all three companies.

Lars Wingefors: "This structure will be based on the values and ideas that Embracer was founded upon, trust, a long-term mindset, and a desire to embrace different perspectives going forward. There is not one way to do business, but some business models are more similar than others. The same goes for businesspeople. The ambitions may be similar, but the approach differs. The similarities between the businesses that will make up Asmodee, "Coffee Stain & Friends" and "Middle-earth Enterprises & Friends" are striking, but so are also the differences when it comes to go-to-market strategies and business profiles. All the companies have bright futures ahead, by perfecting what is working for each of them, and by continuing to cooperate when it makes sense. There is significant untapped potential within the group, which I am confident the new structure will unleash. This will empower each individual and each team to grow and excel further in their careers as well as provide them with their own leadership and strategic direction."

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