LRG’s Owner, Embracer Group, Announces Major Restructuring

Embracer Group, the holding company which currently oversees companies like Gearbox Entertainment and Limited Run Games, has just announced a major restructuring plan. The bad news was handed down directly from the CEO, Lars Wingefors.

Thanks to Smash JT for tipping us off to the open letter from the Embracer Group CEO. Wingefors laid it all out there, saying that measures need to be taken to cut costs:

The program presented today will transform us from our current heavy-investment-mode to a highly cash-flow generative business this year. It will enable us to meet the worsening economy and market reality as a strong company and it will fundamentally change our prioritization of growth with raised capital towards optimization and growth based on our own cashflows. The program will lower our net debt significantly.

The program will take place from 2023 to 2024 and will be broken out into the following phases:

The program is divided into different phases until March 2024 with focus on cost savings, capital allocation, efficiency and consolidation. The initial phase, which is initiated immediately, mainly targets cost savings across the group. The next phase, which also starts immediately, will require further analysis to determine specific actions. The last phase will focus on internal consolidation, further resource utilization and more synergies across the Group. The actions for each affected company will be implemented by the new interim COO and CSO in collaboration with each operative group CEO and management teams. Embracer currently engages close to 17,000 people and while that number will be lower by the end of the year, it is too early to give an exact forecast on this.

Of course, layoffs are hinted at in the CEO’s immediate follow-up:

It is painful to see talented team members leave. Our people are what make up the very fabric of Embracer. I understand and respect that many of you will be worried about your own position and I don’t have all the answers to all questions. I want to be clear that the decisions about this program were not taken lightly.

If I saw this as an employee, I’d be looking for a new job ASAP. This isn’t meant to scare you unnecessarily, but I’ve seen similar memos before in other industries. These statements are usually followed by an e-mail or phone call asking you to come to a meeting room where the pink slips are handed out.

Embracer Group was previously known as Nordic Games Licensing and THQ Nordic and has a plethora of great games under its umbrella, including the recently released Dead Island 2. How this will affect highly anticipated titles like Warhammer 40,000: Space Marine 2 and Payday 3 is not yet known. Considering Embracer Group owns a number of studios, like Cyrstal Dynamics, Edios, and Square Enix Montreal, there’s a possibility that these may be sold off again in the near future.

We’ve speculated that Embracer Group made the call to terminate Kara Lynne from Limited Run Games after a brony with a questionable past led a cancel campaign on Twitter. For more on the LRG fiasco, check out our interview with the company’s former community manager below.

How will the restructuring affect recently purchased companies like Dark Horse? I’m not looking forward to this. How about you?

[Source: Embracer Group] [Source: SmashJT]
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Mike Phalin

Longtime problematic entertainment journalist. The former workhorse for Dread Central,, and Fanbolt.

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