Quick take:
- Square Enix is selling its western business arm to Embracer Group for $300 million.
- The unit includes intellectual property rights for Tomb Raider, Deus Ex and over 50 other games.
- The Japanese entertainment giant wants to focus on blockchain gaming.
Leading video game maker Square Enix is selling its western am to Embracer Group to focus on blockchain gaming. The Japanese gaming giant announced the $300 million deal on May 2, 2022, which includes some of its top AAA titles Tomb Raider and Deus Ex.
Overall, the sale includes more than 50 back-catalogue games and their intellectual property rights. According to the announcement, Square Enix Studios is selling Crystal Dynamics, Square Enix Montréal and Eidos, as well as, the “Thief” and “Legacy Of Kain” franchises.
Commenting on the sale, Square Enix said the cash flows will play a crucial role in cushioning the business against financial shocks caused by a highly volatile business environment.
More importantly, the company added that some of the proceeds will be used to invest in emerging opportunities in the technology sector as part of its broader strategy launched on May 13, 2021.
“The Transaction enables the launch of new businesses by moving forward with investments in fields including blockchain, AI, and the cloud,” Square Enix wrote in a statement announcing the deal.
On the other hand, Embracer’s one press release chose to focus more on the upcoming Tomb Raider game saying “the acquisition brings a compelling pipeline of new instalments from beloved franchises and original IPs, including a new Tomb Raider game.”
Square Enix will retain rights to overseas franchises including Just Cause, Outriders and Life Is Strange. “The transaction will also provide an opportunity to better align our overseas publishing function with our organisation in Tokyo,” the Japan-based video game developer said.
Although analysts attribute Square Enix’s decision to sell its western unit to a lack of traction in the market, it could also be down to the gaming giant’s plans for Web3. The company has recently made a partnership agreement with leading blockchain and metaverse companies in its bid to embrace Web3.
In February, Square Enix inked a deal will Animoca Brands’ metaverse platform the Sandbox to bring Dungeon Siege to the immersive 3D world.
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