Embracer Group Paid $396M For ‘Lord Of The Rings’ Rights
Sweden’s Embracer paid nearly $396M for the rights to the Lord of the Rings franchise.
The 4.25BN SEK ($395.6M) paid for Middle-earth Enterprises was revealed today in Embracer’s annual report. At the time of the deal, no financial figure was placed on the agreement but was thought to be much higher than what has emerged.
The deal with Saul Zaentz Company gave Embracer motion picture, video game, board game, merchandising, theme parks and stage production rights relating to The Lord of the Rings and Hobbit franchises as well as matching rights in other Middle-earth-related literary works authorized by the Tolkien Estate and HarperCollins, which have yet to be explored.
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Layoffs To Come At 'Lord Of The Rings' IP Owner Embracer Group Following Restructure
The news comes just a few days after Embracer revealed it will be implementing a restructure that will lead to layoffs and closures of some divisions. The restructure will focus on “cost savings, capital allocation, efficiency and consolidation,” and CEO Lars Wingefors said it will be “painful to see talented team members leave.”
The Middle-earth Enterprises deal impacted Embracer’s cash flow by SEK 2.9BN ($267M).
The Karlstad-based company posted new sales of SEK 37.7BN ($3.5BN), up 121% year-on-year, and profits of SEK 6.4BN ($594M). However, Embracer CEO and lead shareholder Lars Wingefors said it had been a “challenging year, characterised by a weaker consumer market, but also, for Embracer specifically, game delays and a high-profile deal that did not materialize.”
Embracer brands include Dark Horse Comics, which was acquired at the back end of 2021, and a number of tech and video games businesses.
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