The Swedish Embracer Group holding is one of the most active in the M&A market. According to Bloomberg analysts, over the past 12 months, the company has already announced 27 deals. But such growth carries its own risks.
Borderlands 3″A big risk for gaming companies with inorganic growth is related to what they will do when they run out of shopping goals?
Will they be able to grow organically?” notes Bloomberg analyst Matthew Kanterman. “I don’t think we have reached such a moment in the history of Embracer Group. But it’s worth considering in the future.”
Currently, 69 studios are under the control of Embracer Group, in which about 7000 employees work in total. For comparison, in 2016, when the holding went on the stock exchange, there were only 374 people in it.
Most Embracer Group purchases are quite small. But the company is gradually increasing its appetite. In February, she announced that she would spend up to $1.38 billion to buy Gearbox studio, known for the Borderlands loot shooter franchise.
During its existence, Embracer Group has not published a single big-budget game. She often receives money from a stable flow of AA titles. However, many of her games “shoot” well. For example, the Valheim survival simulator, which sold 6.8 million copies in two months since its release.
The strategy of the Swedish holding is bearing fruit. At the moment, its market value has reached $12.4 billion — 30 times more than in 2016. In addition, it is one and a half times higher than the capitalization of the French Ubisoft ($ 7.6 billion). This assessment makes Embracer Group one of the most expensive gaming companies in Europe.
According to the chairman of Embracer Group, Kicki Wallje-Lund, now his company is going to go beyond the domestic market and list on a major stock exchange like Nasdaq Stockholm or on several exchanges at once.