News Profit's Takes

Middle-Earth Has A New Home!

The Embracer Group recently announced plans to acquire the IP rights to The Lord of the Rings and The Hobbit. This deal includes the rights for other Middle-earth literary works too, so long as they have been authorized by the Tolkien Estate as well as HarperCollins.

Beyond that, the company also plans on purchasing Limited Run Games and Tripwire Interactive. Those two organizations are famous for developing a host of popular games including Metal Slug 3, No More Heroes, several Star Wars titles, and the Killing Floor franchise.

In total, Embracer Group made five acquisitions alongside a sixth, undisclosed deal. These acquisition deals will reportedly cost Embracer Group up to $788 million.

According to an official announcement, Embracer Group does not plan on making any changes to the current structure of Middle-earth Enterprises’ leadership team. Moreover, this leadership group will work with Embracer Freemode to foster more opportunities for growth and synergies within the organization.

“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, the founder of Embracer Group, in a press release posted to the Embracer website on August 17th. “I am thrilled to see what lies in the future for this IP with Freemode and Asmodee as a start within the group.”

The Profit‘s Take:

$788 million feels low. Maybe the price is low because it’s unclear if Embracer can monetize these IP rights outside of video games. They have no experience in movies, TV, etc. It’s possible they’ll just farm out the rights to other studios for millions or billions of dollars at a time. It’s surprising Disney wasn’t involved in this. Less than $1 billion is nothing for them. This pricing is honestly surprising. I don’t know how Embracer scooped this. Maybe we’re missing something in the fine print? It seems too good to be true. Embracer is getting to a place where they will soon be able to join the big boy conversation with Tencent, EA, Activision-Blizzard, and so on.

(All information was provided by Dot Esports, The Verge, and Wikipedia [1,2,3])

0 comments on “Middle-Earth Has A New Home!

Leave a Reply

%d bloggers like this: