‘Lord of the Rings,’ ‘The Hobbit’ Movie, Games and Other Rights Holder Sold to Swedish Gaming Company Embracer

Georg Szalai
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Swedish gaming company Embracer Group has agreed to acquire Middle-earth Enterprises from The Saul Zaentz Company. The division owns an intellectual property catalog and worldwide rights to motion pictures, video games, board games, merchandising, theme parks and stage productions relating to the literary works of The Lord of the Rings trilogy and The Hobbit by J.R.R. Tolkien.

It also owns matching rights to other Middle-earth-related literary works authorized by the Tolkien Estate and HarperCollins, “which have yet to be explored,” the companies said in unveiling the deal Thursday.

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The price tag of the sale to Embracer subsidiary Freemode wasn’t disclosed.

“I am truly excited to have The Lord of the Rings and The Hobbit, one of the world’s most epic fantasy franchises join the Embracer family, opening up more transmedia opportunities, including synergies across our global group,” said Lars Wingefors, founder and group CEO of Embracer, which has been on a shopping spree. “Going forward, we also look forward to collaborating with both existing and new external licensees of our increasingly stronger IP portfolio.”

“We at the Zaentz Company have had the honor over the past half-century of stewarding the Tolkien rights so that Lord of the Rings and Hobbit fans worldwide could enjoy award-winning epic films, challenging video games, first-rate theatre and merchandise of every variety,” said Marty Glick, COO of the Saul Zaentz Company. “We could not be more thrilled that it is Embracer now taking up the responsibility, and we are confident their group will take it to new heights and dimensions while maintaining homage to the spirit of these great literary works.”

The Saul Zaentz Company, based in Berkeley, was founded in 1976 and was originally set up as a film company, which produced the likes of One Flew Over the Cuckoo’s Nest. It acquired its rights from the heirs and estate of Tolkien and HarperCollins Publishers, which maintain the print publication rights to Tolkien’s literary works. In 1998, the firm “licensed New Line Cinema to enable director Peter Jackson’s live-action trilogies of The Lord of the Rings and The Hobbit,” the companies said, highlighting that the movies have grossed more than $6 billion at the box office.

Embracer said its Asmodee Group “is already one of the most successful licensees of The Lord of the Rings and The Hobbit through board games and card games, having published over a dozen games with over 100 expansions since the release of The Lord of the Rings board game over 20 years ago, including classics such as The Lord of the Rings: The Card Game and The Lord of the Rings: Journeys in Middle-earth, a fully-cooperative, app-supported board game set in J.R.R. Tolkien’s iconic land of Middle-earth.”

Key upcoming works, in which Middle-earth Enterprises has financial interests, include Amazon series The Lord of the Rings: Rings of Power, which will premiere Sept. 2, the animated movie The Lord of the Rings: The War of the Rohirrim (Warner Bros.), set for release in 2024, and the mobile game The Lord of the Rings: Heroes of Middle-earth (Electronic Arts).

“Other opportunities include exploring additional movies based on iconic characters, such as Gandalf, Aragorn, Gollum, Galadriel, Eowyn and other characters from the literary works of J.R.R. Tolkien, and continue to provide new opportunities for fans to explore this fictive world through merchandising and other experiences,” Embracer said.

Skadden, Arps, Slate, Meagher & Flom acted as Embracer’s legal advisor on the deal. Arnold & Porter acted as legal advisor to The Saul Zaentz Company, with ACF Investment Bank acting as its investment banker.

In May, Embracer unveiled deals to acquire video games development studios Crystal Dynamics, Eidos-Montreal and Square Enix Montreal for $300 million in cash and debt, giving it popular games IP for the Tomb Raider, Deus Ex, Thief and Legacy of Kain franchises.

On Thursday, in addition to the Middle-earth Enterprises deal, Embracer announced a slew of other acquisitions. Among them are deals for U.S. gaming developer and publisher Tripwire Interactive, known for the Killing Floor and Rising Storm series, as well as Maneater, and Swedish games developer Tuxedo Labs, known for Teardown.

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