Embracer Group has entered into an agreement to acquire Crystal Dynamics, Eidos-Montréal, Square Enix Montréal (~1,100 employees) and a catalogue of IPs including Tomb Raider, Deus Ex, etc (total up $300M)

I don’t care for Square and Ubisoft, WB and Capcom would hurt.

I just want to play Dragon Quest games without having to buy a PlayStation :sob: If this does happen, I would hope they continue releasing on Switch, since that’s a massive market in Japan.

I think it’s meant more to be an educated guess than a tease about something he knows for sure, but yeah I agree with you.

That’s the point.

It’s not weird at all that MS is the one that got ABK.

It’s not comparable at all to what we hear about this acquisition.

So, what’s holding all these other companies?

MS can’t buy a $300M studio because it would change the view on its $70B acquisition?! I doubt that this acquisition is more impactful than Bethesda’s billions and all the previous acquisitions. It doesn’t make sense to me.

What about Sony? They have tens of billions in cash. Is Bungie’s deal stopping them?! Even if they had an acquisition or two or three lined up, what’s stopping them from making multiple acquisitions? Especially if it’s such a bargain and with a company that they are in bed with?

Why about Tencent? Is ABK acquisition stopping them?

What about T2?

EA?

Ubisoft?

Amazon?

… or any investment group?

Suddenly all of them dropped the ball at once and couldn’t figure what we all apparently know here?

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That’s why everybody is confused why Embracer bought Square Enix West for 300m. That’s the main question - why nobody else acquired them. EA spent 1b on Codemasters and more than 1b on a mobile studio, T2 wanted to buy Codemasters and currently is merging with Zynga. Also Tencent has deep pockets…

There is more to it. And if the rumors are true that Square Enix West was up for sale for quite a while., it makes even less sense why for example Microsoft did not acquire them earlier but decided to partner with CD instead. Something something.

This is never going to happen. It’s probably the most popular thing to do on this board.

This would happen. It’s not Square’s IP, or at least not solely their IP. Armor Project (Horii’s studio) owns it and I believe Sugiyama also had ownership (his involvement with the music) though I don’t know what happened here since he kicked the bucket.

Anyway Horii would want DQ on the most popular console in Japan which is currently the Switch. Even with DQIX they put it on DS instead of PS3 and put DQX on Wii instead of PS3 initially.

DQ has the same rules as sports games essentially due to ownership from outside entities.

KH is the same because of Disney.

They could probably do a little strong arming to keep DQ off Xbox though as I doubt Horii would care really. KH could be possible too all depends on how much Disney cares.

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Oh that was shown a long time ago :wink:

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As I just posted on Twitter, I don’t understand how Microsoft didn’t come away with CD/Eidos/IP’s back in September before the Activision deal was made. They made a deal for CD to work on Perfect Dark. They should have went all the way. SMH.

Yep. I understand these studios and ips fit Xbox perfectly. And I get it why some ppl are disappointed. But let’s be honest, there has never been evidence that MS will buy se west. I think sometimes ppl are just being disappointed based on speculation.

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Embracer starting to look real tasty to amazon or apple. Just get nice and plump for the eventual buy out

That’s why I would say that there seems to be little interest in these studios.

or not enough interest to pay more than $300M.

So if there seems to be little interest from all of these companies, why single out MS and assume they have one? (or at least an interest worth $400M-$500M)

Once we establish the value, then we can be ask what’s holding these companies from jumping on a bargain.

But before that, the logical question I think is, why little interest in the first place?

Or they end up like Ubisoft having way too many employees and studios that everyone is hesitant to touch them

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I think last E3 showed…

I don’t :joy:

But seriously people in here really downplaying ABK deal, I get it “losing” TR and Deus Ex is sad but it’s not like they’re not going to be on Xbox anymore.

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Well, according to reports Eidos had like 0.68% margins and CD had like 3.5% So they didn’t generate enough profits for anybody. And big AAA games are too expensive to make. Probably we on the internet are overvaluing Tomb Raider IPs (because let’s be honest there - Thief is dead, Deus Ex is probably too)

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This also seems like squaresoft is looking to sell to Sony by trimming the fat and making themselves look more appetizing

At least we’re gonna get some ports now (Tomb Raider on Switch, Soul Reaver on new consoles)

OK, I’m late to the party here but I have a few thoughts.

  • Like everyone else, I’m surprised at the price. Given the recent data points in the market it seems really low.
  • The financials provided for Crytal Dynamics and Eidos are pretty shocking. Neither studio cracked $100 million in revenue over the last three years. Both are operating at basically break even. A good rule of thumb when looking at numbers like this is to trust the revenue numbers and be skeptical of the income numbers. Even if the income numbers are “accurate” in an auditing sense, there is a lot of accounting trickery that can make income better or worse than it “really” is from an economic standpoint. Revenue is much, much harder to “fake” or “manage.” Given that, I would assume the provided numbers are an “optimistic” view of the income of CD and Eidos. (since I can’t think of a good reason Square would want to lowball the income numbers before the sale).
  • The two studios combined had less than $200 million in revenue and roughly 1,000 employees. That is revenue per employee of less than $200,000, which is pretty awful when you have a highly skilled, highly paid workforce.
  • Given all the above, it looks like Square was eager to get these developers off their books. It looks like they basically sold the IP and threw in the studios for free.
  • The more interesting question is why someone with deeper pockets than Square or Embracer wasn’t willing to pay more than $300 million for them. We keep talking about Amazon, Netflix, etc wanting into this space. Tomb Raider seems like a perfect entry point for either of them. They could launch a new streaming series and a game from that IP alone. It’s starting to look like neither of them may be a real threat after all.
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I think some people here are severly underestimating what a big deal it will be for MS to own ABK, it’s fine to have preferences or prefer other publishers games but ABK will have a bigger impact for xbox than many of these publishers/studios/peopleshopes&dreams etc combined

and again, dont assume this is because of the ABK deal, they got them for $300m, there’s plenty of other publishers and companies out there that could have paid that many times over and yet they didn’t, just like MS

So maybe MS didnt buy because of the ABK deal but that doesn’t explain why nobody else ws interested

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That makes sense to me. And it’s what companies usually think of before investing hundreds of millions.

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