WinterSnowfall: I wonder when the fallout will finally stop. I mean I sort of saw this coming when Embracer Group started acting like high strung venture capitalists and buying every game studio out there, without serious consideration of a backup plan, but still... there's calculated risk and there's reckless behavior, and I'm pretty sure we're not looking at the first in this particular case.
That's probably the case, but on the other hand the plan was probably simply a bet that the market would continue to grow and the sales for games have been amazing so far. However, throughout this acquisition, the world has changed a lot. Corona, war, continued strong competition from free-2-play titles and inflation with the underlying economic crisis in many countries around the world have weakened demand. This means that the prospects for the future no longer look so good and such bets are always focused on the future. The liabilities to the banks are a bet and now they have to be paid back. If I'm not mistaken, that's around 1.2-1.3 billion US dollars and Embracer has only raised just under a billion. However, minus all costs and since the Take-Two deal is made with shares, I expect Embracer to have significantly less money on hand. Maybe $750-850 million. That would still mean a lot of money is missing. I'm not sure if all the layoffs and studio closures can save such amounts at the end of the fiscal year. Ultimately, the three releases in March could bring in a lot of money, but you may not want to spend that because then the shareholders will be angry and there will be a lack of investment capital for future titles.
I suspect Embracer will manage it, they have a real chance with Asmodee and some other profitable studios. The Lord of the Rings license doesn't bring much, it's just a good source of money in the long term. The only question is how Embracer will position itself after the setback and whether they have learned from their mistakes.
