LONDON, Sept 11 (Reuters) – Embracer (EMBRACb.ST) is considering options including selling U.S. game developer Gearbox Entertainment as Europe’s biggest games company looks to shore up its finances. three people familiar with the matter told Reuters.
The maker of the video game “Tomb Raider,” whose shares are traded in Stockholm, is working with Goldman Sachs and Eliam & Co. to consider a sale, people said.
Embracer is considering selling the division, known for its first-person shooter game Borderlands, after receiving interest from third parties, two people said.
Officials at Embracer and Goldman Sachs declined to comment. Eliam did not respond to a request for comment.
Embracer shares turned positive on the news, gaining up to 5%. By 1030 GMT, the rise had slowed but was still up 2.1%.
In June, Embracer announced a restructuring that will reduce its net debt from SEK 16.7 billion at the end of June to less than SEK 10 billion ($903 million) by the end of the year. The plan includes studio closures, project cancellations and layoffs and follows what CEO Lars Wingefors described as a “challenging year” for the company.
Embracer, majority-owned by founder Wingeforth, acquired Gearbox in February 2021 in a deal that valued the business at up to $1.4 billion at the time.
Two of the people said Gearbox’s marketing materials have already been made available to potential buyers, mostly made up of international gaming groups.
The people, who asked not to be identified because the matter is confidential, warned that a deal might not come to fruition.
Gearbox, part of Embracer’s PC console games division, released its latest game Remnant 2 last month, topping the US charts in July.
Embracer, which owns more than 900 franchises, announced a review of its business in November last year to weather tough economic conditions, which could result in a spin-off of the division.
Embracer announced in May that it had reached a verbal agreement with undisclosed parties in October of the previous year to generate more than $2 billion in “contract development revenue” over six years. However, in the last hour it announced that it had “received negative results from its counterparties,” and its stock price fell more than 40%.
($1 = 11.0786 Swedish Crowns)
Reported by Amy Jo Crowley.Editing: Anusha Sakoui and Jason Neely
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