Embracer | doomed $2 billion deal was reportedly with Saudi-backed Savvy Games


In May, Swedish company Embracer saw its shares tumble after news that a mystery $2 billion deal had collapsed. That deal was reportedly with Savvy Games.


With such valuable properties as Tomb Raider and The Lord of the Rings in its possession, and having acquired studios like Crystal Dynamics, 3D Realms and Gearbox, Embracer Group is one of the biggest companies in gaming.

In May, however, the Swedish firm saw its shares tumble by 40 percent following news that a deal worth north of $2 billion had collapsed on the eve of completion. Since then, there’s been some speculation, not least on this very site, over who exactly that deal was with. Given the sum of money involved – $2 billion in “contracted revenue over a period of six years”, as Embracer put it – the unnamed partner in the deal was clearly a large one.

According to sources spoken to by Axios’ Stephen Totilo, however, we may know who the mystery company was: Savvy Games Group, which was founded in January 2022 and is owned by Saudi Arabia’s sovereign wealth fund. Axios cites “four anonymous sources familiar with the deal” and has reviewed “documentation related to the planned partnership.”

Chaired by Crown Prince Mohammed Bin Salman, Savvy is a company with around $38 billion in government money behind it, including $13 billion to invest in acquiring game studios.

In June 2022, Savvy invested $1 billion into Embracer, giving it an 8.1 percent share in the Swedish company. Embracer CEO Lars Wingefors said the deal would enable his company to “set up a regional hub in Saudi Arabia, from which we will be able to make investments across the MENA [Middle East/North Africa] region.”

The deal wasn’t without controversy, however, not least because of Saudi Arabia’s grim human rights record,

Embracer didn’t mention Savvy by name in its May 2023 press release, but it said that it had a “verbal commitment” to the $2bn deal with the unspecified company as long ago as October 2022. “All documentation was finalised and ready to go as of yesterday,” Embracer wrote. “However, late last night we received a negative outcome from the counterparty.”

News of the collapsed deal sent Embracer’s stock prices falling from SEK 41 to SEK 25, and prompted the company to embark on an extensive range of cost-cutting measures.

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