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Embracer Group sells off Space Marine maker Saber Interactive and most of its studios for $247M, but the price could go a lot higher

 Warhammer 40000: Space Marine 2 screen.
Warhammer 40000: Space Marine 2 screen.

Embracer Group has announced the sale of Saber Interactive to a company called Beacon Interactive, founded by Saber co-founder Matthew Karch, in a deal worth $247 million, although options in the deal mean that price could go much higher. The deal will also see Embracer halt all operations in Russia, which the company said in a presentation "reduces geopolitical risk."

"I am pleased that we have found a win-win solution for Embracer and the parts of Saber that now will leave us," Embracer CEO Lars Wingefors said in the announcement. "This transaction puts both companies in a stronger position to thrive going forward. Embracer is now able to discontinue all operations in Russia, according to a previous board decision, while safeguarding many developer jobs under new independent ownership.

"At the same time, we keep key companies, valuable IPs and future publishing rights. Cash flow is immediately improved, and we remain committed to reducing net debt."

As Wingefors said, the deal will see most of the studios operating as part of Embracer's Saber Interactive division, but not all of them, go to Beacon. Studios leaving Embracer as part of the sale include:

  • All Saber-branded studios

  • DIGIC

  • Fractured Bye

  • Mad Head Games

  • New World Interactive

  • Nimble Giant

  • Saber Interactive Inc

  • Sandbox Strategies

  • Slipgate

  • 3D Realms

Embracer will retain some big names that were previously operating under the Saber division:

  • 34 Big Things

  • 4A Games

  • Aspyr

  • Beamdog

  • Demiurge

  • Shiver

  • Snapshot

  • Tripwire Interactive

  • Tuxedo Labs

  • Zen Studios

However, the deal also includes an option to enable Beacon to acquire 4A Games and Zen Studios "within a certain time period," and according to Bloomberg's Jason Schreier, Karch has already said that Saber is picking them up too. If so, that will reportedly bump the purchase price up to roughly $500 million, although the terms of the option were not revealed.

Embracer said 38 projects currently in development are included with the sale, while 14—including two "joint projects" with Beacon—will be retained. Those include "the next AAA game from 4A Games," which is presumably the next Metro, Killing Floor 3, the ongoing development of Teardown, and "the full upcoming pipeline and back catalog from Zen Studios, Aspyr, and Tripwire."

That last bit might feel like a bit of a dodged bullet for Knights of the Old Republic fans. Aspyr was working on the Schrodinger's Cat-alike KOTOR remake, but was pulled off the project in mid-2022. It's reportedly not dead, although what's really going on is anyone's guess, but responsibility for the remake was reportedly included with the Saber sale, which may—dare we dream—mean that it actually might get made at some point.

(Aspyr's recent performance with Star Wars Battlefront Classic Collection may also prompt some quiet sense of relief that someone else is doing the KOTOR remake.)

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Embracer Group sells Saber Interactive, ceases operations in Russia - presentation slide
Embracer Group sells Saber Interactive, ceases operations in Russia - presentation slide

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Embracer Group sells Saber Interactive, ceases operations in Russia - presentation slide
Embracer Group sells Saber Interactive, ceases operations in Russia - presentation slide

Karch said the deal "leaves both parties in much better positions to grow our respective businesses," and more importantly, that it "safeguards the livelihoods of hundreds of professionals." Sell-offs and acquisitions don't necessarily ensure job security (especially in this business) but for now it's a far better outcome than the fates suffered by some Embracer studios, including Free Radical Design and Volition, which were closed outright following the collapse of a $2 billion investment deal that sent Embracer into a spiral.

Wingefors described the Saber sale as "the first transaction" of its previously announced recovery plan, suggesting that more is on the way—possibly including the finalization of a Gearbox sale, which is rumored to be in the "late stages" of completion.

He also seemed to be choosing his words a little more carefully, saying the deal "marks a small but important step in our journey to transform Embracer into the future for the benefit of all employees, gamers, and shareholders." That stands in sharp contrast to previous statements from Embracer executives, including Wingefors, which have been focused squarely on the well-being of shareholders—and which have not gone over particularly well with anyone else. Maybe Wingefors is finally learning that there are more than just investors listening to what he says.