Embracer Sells Borderlands Maker Gearbox For Less Than Half Of What It Paid [Updated]
Another company has escaped the gaping, acquisition-hungry maw that is publisher Embracer Group, as Borderlands developer Gearbox Software has been sold to Take-Two Interactive. This lines up with Kotaku’s previous reporting on the matter in February, in which sources told us Gearbox was nearing a sale. Embracer is selling the company at a significant loss after buying Gearbox for $1.3 billion in 2021, with Take-Two only paying $460 million to bring the Texas-based company into the fold.
Embracer does retain the rights to some parts of Gearbox’s business as per the sales terms, including Gearbox’s San Francisco Publishing branch (which will be renamed), publishing rights to the Remnant franchise, and the upcoming Hyper Light Breaker from Heart Machine. Embracer will also still publish some “unannounced” games that are part of Gearbox’s portfolio, but no further details were disclosed in the official announcement. Embracer is also keeping Cryptic Studios, which develops Neverwinter Online and Star Trek Online, Lost Boys Interactive, which recently did support work on Tiny Tina’s Wonderlands, and 3D modeling company Captured Dimensions. The deal says all of these companies are “expected to contribute with a positive cash flow going forward.”
The entire deal will be paid in newly issued Take-Two shares, with closing expected to be completed by the end of Embracer’s fiscal first quarter, which ends in June 2024. As for what’s next for Gearbox under Take-Two, a separate press release from the publisher reveals Gearbox is actively developing a new game in the Borderlands series, as well as the next game in the real-time strategy franchise Homeworld.
This move comes just two weeks after Embracer also sold off Saber Interactive, which itself followed the cancellation of nearly 30 games in Embracer’s portfolio and the loss of over 1,300 jobs. Embracer’s years-long acquisition spree has affected the lives of thousands of workers in the video game industry, and all it has to show for it is lost jobs, canceled games, and selling those companies for less than half of what it paid for them. What a shitshow.
Updated: 3/28/2024, 1:04 p.m. ET: Following the sale announcement, aGearbox spokesperson confirmed in a statement to Kotaku that Embracer has laid off employees who are “not tied to the development” of its games. This has affected PR workers, marketing, user research, and other sectors of the company. The full statement reads as follows:
“Thank you for your thoughts and care for The Gearbox Entertainment Company as some reports of internal communication and actions are starting to flow through public channels. As we strive towards our mission to entertain the world, we are grateful that our talent and capability are of interest to you and your audience. The Embracer Group will continue to report on their restructuring program that impacted some parts of Gearbox today that are not tied to the development of Gearbox Software games. Thank you for granting us the space to remain focused on our people and in our handling of the situation with compassion and manage the process, balancing between our present duty and a commitment to our future.”
