Frisco Gearbox video game developer sells global giant contract worth up to $ 1.3 billion

Frisco-based Gearbox Entertainment Co., developer of popular video game titles Brothers in arms and Borders, is in the process of being acquired by a Swedish company in a deal worth up to $ 1.3 billion.

Gearbox, founded in 1999, will become a wholly-owned subsidiary of Karlstad, Sweden-based Embracer Group, a global game development player with more than 5,500 employees in eight operating groups.

The deal is part of an acquisition of three companies by Embracer which also includes the Cypriot company Easybrain and based in Austin Aspyr Media. Easybrain makes advertising puzzle and logic games and Aspyr Media publishes video games, including bringing the Call of Duty and Star wars franchises to Apple’s Mac platform.

The three deals could reach around $ 2.5 billion in combined value over the next several years.

Embracer Group noted it would initially pay Gearbox $ 363 million with a commitment of an additional $ 1 billion over the next six years if performance targets are met. Gearbox is expected to accumulate a pre-tax profit of $ 1.3 billion during this period, Embracer said.

In 2019, Gearbox’s revenue was $ 125 million. In 2020, it grossed $ 123 million in a nine-month period ending September 30.

In a statement, Gearbox said the deal gives it access to capital, “by adding rocket fuel to [its] powerful creative engine. His plan under Embracer is to hire new talent from his design studios in Frisco and Quebec City, create new studios and maybe even become an acquirer himself.

Gearbox is an employee-owned company with 550 employees. Its game portfolio also includes Half-life, Counter strike, Tony Hawk’s professional skater, 007 James Bond and Halo.

His Borders The franchise has sold over 60 million copies. Brothers in arms, released in 2005, has since grown into three franchise titles and 11 spinoffs. The series has sold over 10 million copies.

Gearbox has also recently expanded into film and TV with three projects in development – a TV series based on Brothers in arms, a feature film based on Duke Nukem and one Borders film in collaboration with Lionsgate.

“Gearbox is arguably one of the most creative and valuable independent developers in the world,” said Lars Wingefors, CEO and Founder of Embracer. “We believe the resources offered by Embracer will position Gearbox for significant growth in the years to come.”

Founder Randy Pitchford, who will continue to lead Gearbox, praised Embracer for his approach to the businesses he acquires – letting them operate as “decentralized and successful entrepreneurial businesses.”

“The feeling at Gearbox is that we are just getting started and this transaction is not only a stimulus for the talent of our company owned by our employees, but a propellant for the exciting future that we have planned,” he said. he said in a statement.

With revenue of $ 624 million in its fiscal year ended March 30, Embracer experienced spectacular growth last year through a series of acquisitions. It bought a dozen small game studios in a single day in November and made seven acquisitions in August. In February 2020, he spent $ 525 million to buy game developer Saber Interactive.

Source link