Support NeoGAF

[Boss Mog]

Square-Enix really is their own worst enemy. This is a company that should be dominating the gaming industry and yet they constantly shoot themselves in the foot. They have a bunch of beloved Japanese IPs like FF and DQ but then they also had some of the West's top IPs as well in the form of Tomb Raider, Hitman, Deus Ex and Just Cause and yet they managed to constantly fuck things up and now they sold those great IPs for a measly $300M.

 

[Pantz]

 

[Zok310]

None of the loser “insiders” got the run up on this?. Figured them asshole would have said something if they did know.

 

[Craig of War]

Codemasters came with some high profile licenses like F1 and WRC.

What about Gearbox is Borderlands that much bigger than Tomb Raider?

 

[Ywap]

Ordering one meal of Deus Ex please

 

[The_hunter]

Ah these guys are THQ nordic. Let's get another deus ex game.

 

[ByWatterson]

Theory:

Someone is about to buy Square outright, but didn't want those IP/developers and felt they were extra baggage.

 

[Mr Moose]

300M is very low to put this deal into perspective

EA Bought Codemaster for 1.2 billion
Embracer bought GearBox for 1.3 billion

So looking at this again i don't know what the hell Square is smoking by selling for only 300M
Sony need to buy the rest of Square Enix Japan they probably going for cheap lol

They don't have to pay 1,100 peoples wages anymore. Those IPs though

 

[Bernd Lauert]

What about Gearbox is Borderlands that much bigger than Tomb Raider?

Gearbox is more complicated, the amount of money paid is tied to performance metrics over the next 5 years. Embracer has so far only paid around $360m for Gearbox.

 

[Panajev2001a]

”We are thrilled to welcome these studios into the Embracer Group. We recognize the fantastic IP, world class creative talent, and track record of excellence that have been demonstrated time and again over the past decades. It has been a great pleasure meeting the leadership teams and discussing future plans for how they can realize their ambitions and become a great part of Embracer,” says Lars Wingefors, Co-founder and Group CEO, Embracer Group.

”Embracer is the best kept secret in gaming: a massive, decentralized collection of entrepreneurs whom we are thrilled to become a part of today. It is the perfect fit for our ambitions: make high-quality games, with great people, sustainably, and grow our existing franchises to their best versions ever. Embracer allows us to forge new partnerships across all media to maximize our franchises’ potential and live our dreams of making extraordinary entertainment,” says Phil Rogers, Square Enix America and Europe CEO.


Background and rationale

The collection of studios represents a world-class creative team of ~1,100 employees across three studios and eight global locations, including two of the most reputable AAA studios across the industry in Crystal Dynamics and Eidos Montréal. The studios possess a unique ability to deliver blockbuster hits decade after decade. The acquisition brings a compelling pipeline of new installments from beloved franchises and original IPs, including a new Tomb Raider game. The acquisition builds on Embracer’s mission of creating a leading independent global gaming and entertainment ecosystem. Embracer has been particularly impressed by the studios’ rich portfolio of original IP, housing brands with proven global potential such as Tomb Raider and Deus Ex, as well as demonstrating the ability to create AAA games with large and growing fan bases. There are compelling opportunities to organically grow the studios to maximize their commercial opportunities.

Embracer Group enters into an agreement to acquire Eidos, Crystal Dynamics, and Square Enix Montréal amongst other assets - Embracer Group

Embracer Group AB (”Embracer”) has entered into an agreement to acquire the development studios Crystal Dynamics, Eidos-Montréal, Square Enix Montréal, and a catalogue of IPs including Tomb Raider, Deus Ex, Thief, Legacy of Kain and more than 50 back-catalogue games from SQUARE ENIX HOLDINGS...

embracer.com

I am not sure Square-Enix needs a cash infusion so badly, it is not even a huge cash infusion either and they lost a lot of talent there that helped diversify their publisher ambitions. They could be prepping themselves as an acquisition target and divesting of resources acquirers would not be interested in paying a premium for while taking extra cash in the short term and thus better return to stockholders.

 

[Ozriel]

Definitely not.

The Revenue activision will pull from a single year of Warzone will likely dwarf revenues CD et al will make from tomb Raider and Deus Ex combined all gen.

More Deus ex!

Thankfully it wasn't MS.

I’d have thought their recent partnership with Crystal Dynamics for Perfect Dark would have met the ‘organic’ threshold?

 

[The Cockatrice]

Honestly not sure about Embracer Group, an unknown at this point, but Deus Ex is at least free from that garbage company Square Enix and now theres actually hope for a new one.

 

[GHound]

None of the loser “insiders” got the run up on this?. Figured them asshole would have said something if they did know.

I pissed out my ass but it was a month late. Does that mean I'm pregnant?

 

[bitbydeath]

The Revenue activision will pull from a single year of Warzone will likely dwarf revenues CD et al will make from tomb Raider and Deus Ex combined all gen.

I don’t care about their revenue, the games themselves are a better deal, better than the Bungie buy too.

 

[Bernd Lauert]

None of the loser “insiders” got the run up on this?. Figured them asshole would have said something if they did know.

Insiders don't know anything about acquisitions. It's common sense when you think about, who in their right mind would leak an acqusition? It would have large legal reprecussions, so of course nobody does it.

 

[thicc_girls_are_teh_best]

Bruh WTF, they decide to do this today of all days . Guess this takes them off the table for Microsoft, then.

Please keep Deus Ex alive

Also, 300 million seems kinda cheap

It is. Insomniac were cheap, too, but I'm guessing the price for these teams is so low due to relatively low market success of their recent output.

Which kind of falls more on Square-Enix the publisher, really, but it is what it is :/

 

[Duchess]

What the fuck is going on with this industry?!

 

[reksveks]

 

[onesvenus]

I am not sure Square-Enix needs a cash infusion so badly, it is not even a huge cash infusion either and they lost a lot of talent there that helped diversify their publisher ambitions. They could be prepping themselves as an acquisition target and divesting of resources acquirers would not be interested in paying a premium for while giving cash in the short term and better return to stockholders.

I agree. The only thing that doesn't make sense to me is that I don't think they wouldn't invest in Blockchain, AI and Cloud if they did that to prepare themselves for an acquisition

 

[GymWolf]

Is this acquisition any good for us??

 

[Mech_Warrior]

Crystal Dynamics made Avengers.

Do we finally see a Deus Ex game?

 

[shaddam]

300 million? That should be pocket money right?

 

[nikolino840]

So Sony could buy Square JAP?

 

[plasmawave]

What about Sega?

 

[remember_spinal]

Now i actually do believe Sony could buy Square Enix (whats left of it)

This sale seems like such a nothing burger for a company the size of S-E, especially with Tomb Raider attached it leaves questions

 

[Mech_Warrior]

Now i actually do believe sony could buy Square Enix (whats left of it)

That would be a dumb purchase.

 

[Xellos]

SE/Eidos always seemed like a strange marriage.

Hope this means Deus Ex, Thief and the rest get another chance. At the very least I'd like to see some remasters/collections.

 

[Xyphie]

The Embracer rollup continues.

 

[StealthGoblin]

I think this says everything we ever needed to know about Crystal Dynamics. That Microsoft deal was keeping the wolves from the door.

 

[lh032]

That would be a dumb purchase.

depends on the price though. I mean...Sony bought bungie for 3 b ._________.

FF14 making loads of money.

 

[cormack12]

Embracer not fucking about. How will purple hairs justify playing the new tomb raider now after their stances against THQN.

We gonna see those straws being grasped for with Koch media etc?

 

[LordCBH]

Unexpected/10

 

[remember_spinal]

That would be a dumb purchase.

Sony probably spent 300 million on Forspoken and FF16 timed exclusivity alone. Getting stuff like Kingdom Hearts 4, Dragon Quest 12, FF14 permenantly would be a no brainer.

 

[Amiga]

Also, 300 million seems kinda cheap

For SE the extra value is getting over 1000 employees in expansive cities off the books, probably offloading some debt also. The IP's are nostalgic but don't carry a lot of current market worth.

 

[Mech_Warrior]

I can't believe Square abandoned Deus Ex and cost themselves billions.

They even gave up on Tomb Raider. Absolutely insane.

 

[remember_spinal]

Also, yeah, count me in with the crowd that was happy this stayed multiplat.

Microsoft 100% would have pounced on it had they not been dealing with Acitivison/Blizzard, especially for Crystal Dynamics and tomb raider

 

[Snake29]

Better than Sony because games would not be confined to playstation, but certainly not better than microsoft. Microsoft would have had the games on every platform and device (outside playstation) plus large budgets and support. Embracer seems to like to things on the very cheap side as far as productions go. If we'll get new games in these franchises you can forget them being these lavish top tier productions that they were

Large budgets and support is what SIE is known for. In that specific case, i trust SIE more when it comes to game development and studio management then Microsoft/Xbox.

 

[Danteyke223]

On the one hand, I'm happy that they are out of Square Enix's perpetual blame game every financial year. On the other hand, this should have been Microsoft buying them to give these people actual budget and pay. Not sure if Embracer is up to the task of doing AAA releases of anything, as they been mostly doing middleware / AA stuff. At least we might get Soul Reaver remakes.

 

[reksveks]

Doing the maths and using the numbers from here.

https://www.hd.square-enix.com/eng/ir/pdf/20220502%20A_Press%20Release_fin.pdf

Its not alot of profit there at the moment.

This is for CD and Eidos

 

[Godot25]

So I can finally send Square Enix to the category: "I'm not interested in anything this company does"
Cool

 

[Craig of War]

Fun Fact Embracer has bought more studios then Both Sony and MS combine
Should we be worried about the Embracer Monopoly

 

[Bragr]

A sign that Square Enix is almost done and that these games never made that much money compared to their budgets.

 

[remember_spinal]

Better than Sony because games would not be confined to playstation, but certainly not better than microsoft. Microsoft would have had the games on every platform and device (outside playstation) plus large budgets and support. Embracer seems to like to things on the very cheap side as far as productions go. If we'll get new games in these franchises you can forget them being these lavish top tier productions that they were

I love the narrative of xbox releasing on xbox and pc being “releasing on everything” and sony releasing on playstation and pc being “confined to playstation”.

Also totally ignoring nintendo

 

[John Wick]

Well, at least these games would still stay multiplatform (unless theres time exclusive or special partnership going on)


Oh, and im surprised they did not get outbid by Microsoft according to certain group of people.

I know how come MS hasn't outbid them? I'm waiting for the usual suspects????

 

[Varteras]

That seems like an incredibly low number. Did no one else even try to offer more than $300 million for several studios and a slew of IP? Was there more to the deal than just the cash? I mean, clearly there are plenty of companies that could have afforded more than that.

 

[Despiralman69]

Hope this isnt true, embracer has had alot more fails then hits, if it wasnt for coffeestain games publishing some games id say embraser has been a total failure with extremely budgeted games

 

[Mech_Warrior]

That seems like an incredibly low number. Did no one else even try to offer more than $300 million for several studios and a slew of IP? Was there more to the deal than just the cash? I mean, clearly there are plenty of companies that could have afforded more than that.

Then you have WB selling their studios without the Batman/LOTR/Harry Potter license.

Square Enix gave up on multiple IPs. This is highway robbery by Embracer Group.

 

[Craig of War]

That seems like an incredibly low number. Did no one else even try to offer more than $300 million for several studios and a slew of IP? Was there more to the deal than just the cash? I mean, clearly there are plenty of companies that could have afforded more than that.

Yeah this deal seem weird as hell they got all of that for 300M
So Maybe Sony & MS are busy at the moment with their deal and cannot buy yet
So what about Tencent or EA i find this weird ass hell that no one else willing to pay more then 300M

 

[DukeNukem00]

Large budgets and support is what SIE is known for. In that specific case, i trust SIE more when it comes to game development and studio management then Microsoft/Xbox.

How is sony known for large budgets ? The budgets where we have numbers are a third of that 3rd party publishers invest. I noticed there's this illusion that there's "1st party money". For some bizzare reason, some people are under the impression that a game sold on a single platform gets a bigger budget than a game sold on FOUR platforms. You budget a game based on predicted ROI. You are not getting from one platform what you can get from four. The largest budgets are from 3rd party devs, not 1st party, be it microsoft or sony.

Horizon 1 had a budget of aprox 40 million and Shadow of the Tomb Raider which came out next year had a budget on the high end of 135 million, which was claimed it was standard at the time for games of that type.

Other than Last of Us 2 and Horizon 2 right now, none of sonys games are breaking the bank budget wise. A lot of them were riskier affairs, for example God of War 2018. That was coming in a franchise where the last game bombed. And the new game they had these crazy ideas about no cuts cameras, changing the dirrection from what it was. Do you think GOW was some huge budget affair ? It had id say a moderate budget. Why do you think the gameworld is near empty, you have like 5 npc's the entire game, combat scenarios are rare and constrained to arenas, mini bosses reskined and repeated, puzzles repeating the whole game the same one. These were cost cutting choices, because they didnt have money to make more. Im sure the sequel will though, after the big success it had

 

[Varteras]

Then you have WB selling their studios without the Batman license. Does it even come with the LOTR license for Shadow of Mordor? Harry Potter?

Yeah this deal seem weird as hell they got all of that for 300M
So Maybe Sony & MS are busy at the moment with their deal and cannot buy yet
So what about Tencent or EA i find this weird ass hell that no one else willing to pay more then 300M

Yeah I'm legitimately mindblown that Embracer gets those studios and all those IP for a mere $300 million. Sony bought Insomniac alone for $230 million and they sure as hell didn't come with the IP this lot does. Where were literally ANY of these other companies in this? This really has to make one reconsider the conventional wisdom of these acquisitions. Because this shit makes no sense to me.