Take-Two Interactive and Embracer Group have announced that they have entered into a definitive agreement with each other that has Take-Two acquiring Gearbox Entertainment, developers of the Borderlands series, for $460 million. Embracer acquired Gearbox back in 2021 but reports suggested this would be an outcome following difficult financial year. This is the next step in Embracer Group’s restructuring program. According to the press release, the acquisition will be completed during the first quarter of Take-Two’s Fiscal Year 2025 (ends June 30, 2024).
“Today’s announcement marks the result of the final structured divestment process and is an important step in transforming Embracer into the future with notably lower net debt and improved free cash flow. Through the transaction, we lower business risk and improve profitability as we transition to becoming a leaner and more focused company. After evaluating several options for Gearbox, I am happy that we have reached a solution that is in the best interest of all stakeholders. Randy and the team have been great team members throughout the past years, and I would like to thank them all for that. As one of the world’s greatest games developers, I am confident that Gearbox will continue to innovate and thrive in their new home within Take-Two,” says Lars Wingefors, co-founder and CEO of Embracer.
”As a significant long-term Embracer Group shareholder, I believe in the strategy for the Embracer Group going forward and am completely convinced that this transaction is the best possible scenario and an obvious net positive arrangement for Embracer Group, for Take-Two and, of course, for Gearbox Entertainment. My primary interest is always Gearbox, especially our talent and our customers. I want to personally assure fans of our games that this arrangement will ensure that the experiences we have in development at Gearbox will be the best they can possibly be,” says Randy Pitchford, founder and CEO of Gearbox Entertainment.
Take-Two says that it expects acquiring Gearbox Entertainment will deepen its successful relationship and provide increased financial benefits through a fully integrated operational structure. Take-Two will acquire full ownership of Gearbox’s portfolio including the critically and commercially acclaimed Borderlands and Tiny Tina’s Wonderlands franchises, Homeworld, Risk of Rain, Brothers in Arms, Duke Nukem, and Gearbox’s future pipeline.
Take-Two says that Gearbox currently has six key projects in development, including five sequels, two of which are from the Borderlands and Homeworld franchises, and at least two new games.
“Our acquisition of Gearbox is an exciting moment for Take-Two and will strengthen our industry-leading creative talent and portfolio of owned intellectual property, including the iconic Borderlands franchise,” said Strauss Zelnick, Chairman and CEO of Take-Two. “This combination enhances the financial profile of our existing projects with Gearbox and unlocks the opportunity for us to drive increased long-term growth by leveraging the full resources of Take-Two across all of Gearbox’s exciting initiatives.”
“With nearly 20 years of history working together, Gearbox has played an integral role in our success, given their unique ability to create interactive entertainment experiences that feature beloved characters, exciting new worlds, and humorous storytelling,” added David Ismailer, President of 2K. “We are thrilled to welcome Randy Pitchford and his team of passionate, talented developers to 2K and we look forward to releasing numerous projects in the future as colleagues. We have loved partnering with Gearbox on every iteration of the Borderlands franchise and are excited to be in active development on the next installment in the series.”
Talking about being acquired by Take-Two, Pitchford said “Joining forces with Take-Two Interactive and 2K will help Gearbox ascend to our next level. Take-Two and 2K have demonstrated repeatedly their commitment to our engine of generating creativity, happiness, and profit. We set the bar for interactive entertainment and achieved remarkable results with groundbreaking, record-setting games when we worked together at arm’s length as partners. I’m incredibly excited about what we can accomplish now that we’re fully aligned as one.”