Japanese video game publisher Square Enix is marketing the Tomb Raider franchise to Swedish Embracer Group in a $300M deal.
Embracer will also formulate the intellectual property for three other game series, including Thief, Deux Ex, and Legacy of Kain.
Square Enix said it is marketing the assets to cut costs and invest in the latest technologies, such as the blockchain.
The iconic Tomb Raider video play franchise is marketed by its Japanese publisher Square Enix as a $300 million deal.
Square Enix said Monday it would offload three of its game development studios — Crystal Dynamics, Eidos Interactive, and Square Enix Montreal — to Swedish company Embracer Group.
Embracer will also receive the intellectual property for Tomb Raider and three other game sequels, including Thief, Legacy of Kain, and Deux Ex.
Square Enix said it is peddling the assets to cut costs amid a challenging global business environment while investing in new technologies like the blockchain.
The deal “allows the launch of new businesses by moving ahead with investments in fields including AI, blockchain, and the cloud,” Square Enix said in a statement revealing the news.
The company’s commitment to ramp up spending on blockchain — the technology behind multiple cryptocurrencies and non-fungible tokens — led to a backlash on social media. One user expressed the move stood “like selling your house for magic beans.”
The gamer crowd has generally been skeptical about NFTs — digital assets created to represent ownership of one-of-a-kind collectible articles.
While technology advocates say it could unlock new kinds of gaming experiences, many gamers aren’t convinced, viewing NFTs as an environmentally harmful cash grab.
Tomb Raider is the most well-known video game franchise. The games see players navigate British archaeologist Lara Croft through a series of ancient tombs and hazardous ruins. It has sold roughly 88 million copies to date.
Tomb Raider’s heroine quickly became a cultural icon, inspiring numerous films and merchandise while provoking a debate over the over-sexualization of female characters in the gaming industry.
Square Enix, best known for its famous Dragon Quest, Final Fantasy, and Kingdom Hearts games, earned ownership of the Tomb Raider series after purchasing Eidos Interactive in 2009.
It is now positioned to become the property of Sweden’s Embracer, with the company hoping the deal will be approved and concluded by the end of September.
Embracer is not a household name in gaming. But, initially set up as a comic book and games retailer, the company has become one of Europe’s largest gaming groups after snapping up a slew of significant studios, including Gearbox, developer of the Borderlands shooter franchise, and Koch Media.
Gaming analysts said the deal price for Square Enix’s Western assets was surprisingly low but that the company had long been seeking a buyer.
“Square Enix has been seeking to offload this part of its business to restructure and focus its investments,” Piers Harding-Rolls, head of games research at Ampere Analysis.
Square Enix sells Tomb Raider and big franchises for less than 1% of what Microsoft paid for Activision. Embracer Group, a video game publisher, has decided to buy a handful of studios from publisher Square Enix, driving up most of the Japan-based studio’s Western procedures. The deal will set Embracer in control of familiar franchises, including Tomb Raider, Deus Ex, Thief, and Legacy of Kain.
The price label for Square Enix Montreal, Crystal Dynamics, Eidos-Montreal, and the catalog of intellectual properties was a surprisingly low $300M. That’s lower than one-half of 1% of the $69 Bn Microsoft pays for Activision-Blizzard. And far smaller than the $3.6 billion Sony approved to pay for Bungie, inventor of the Halo franchise.
The deal will affect around 1,100 employees and is expected to complete before September.
While Microsoft has been swallowing up development studios and franchises for the past several years as a piece of its Netflix-like strategy for video game development, Embracer has been a quiet competitor, cherry-picking notable individual game development studios, including Saber Interactive, creator of World War Z and WWE 2K Battlegrounds and Borderlands creator Gearbox Entertainment.
Embracer has announced about 30 takeovers in the past 24 months. As a result, the relatively unknown Swedish company has peacefully become Europe’s most valuable video game creator.
As part of this deal, Tomb Raider and the other franchises Embracer will acquire haven’t pinnacled the sales charts for many years but still have immense value. However, critics have pointed out that Square Enix’s management of the studios has been lacking, as the company focused more on its legacy titles, such as Final Fantasy, Dragon Quest, and Kingdom Hearts.
“It has struggled to get consistent commercial success out of those studios. It wants to build a leaner organization with a more compelling growth and profit story for its shareholders.”
Square Enix said it would continue to publish titles from other international franchises, including Just Cause, Outriders, and Life is Strange.