New Lord of the Rings owner Embracer hints at future plans

Embracer Group, the new owners of Middle Earth Enterprises – the holding company that owns ‘The Lord of the Rings’ among other JRR Tolkien titles – have given a first hint of what they might have for the works during a presentation for its second quarter the author have scheduled earnings report on Thursday.

Among the rights that Sweden-based Embracer Group now owns to the Lord of the Rings IP, having bought Middle Earth Enterprises for an undisclosed sum from previous owner Saul Zaentz Co. in October, are rights to develop and manufacture Movies, Games and Theme Parks Attractions.

While Lars Wingefors, Embracer co-founder and CEO, didn’t want to go into specifics, he did reveal that he was consulting with “all stakeholders” — including film companies and business partners — on the best way to develop what he calls a “worldwide leading” means fantasy IP.”

Wingefors did not specify whether those stakeholders included Warner Bros. Discovery, who are believed to still retain some film development rights to ‘Lord of the Rings’ through their ownership of New Line Cinema, which produced Peter Jackson’s film trilogy (pictured above) . It is unclear how these were affected by the sale of Middle Earth Enterprises.

Embracer is primarily known for its games production: video games and mobile phones in the digital realm and board games and card games in the physical realm.

Speaking more generally about the group’s entry into film and television, Wingefors said he’s spoken to “top players in the industry” and is pleased to “see the excitement they have around our IPs,” who, like “Mr of the Rings” This includes “Tomb Raider” and “The Mask” along with hundreds of other titles.

Embracer Co-Founder and CEO Lars Wingefors (Courtesy Embracer Group)

But when asked for more news about the Tolkien takeover, he cryptically replied, “Wow, that’s a very interesting question. tolkien We could spend an hour on this.

“Apparently we closed the transaction after the end of the quarter, in early October, and are now in discussion with all parties involved, the film companies, the business partners and the games companies,” added Wingefors. “We take the perspective [of] a very long-term view: How should we, together with the other stakeholders, develop this world-leading fantasy IP into the future? Gaming is part of it. But it is still too early to give color to our concrete plans. I think we’re still open to […] entrance to it. I find [there’s] also very interesting talks about media other than games related to this IP. But unfortunately I have to tell you: stay tuned for the future.”

Asked during a second round of Q&A about Embracer’s overall plans for film and television, Wingefors said, “I think it’s still early days. Looking now at the film and TV side, there is significant interest in a number of our key IPs going forward. But we didn’t execute [or] still assigned things. We are still at the beginning, we are still in the long term. We may need to gather our forces even more to increase our influence on this front. But I was delighted to speak to a number of the top players in the industry and hear their excitement about our IPs.”

“How long will it be before we see Middle-earth in this context?” the interviewer, equities analyst Martin Arnell, pressed.

Wingefors replied: “It is very difficult for me to comment on anything on this front, but if you work long-term I am confident that one day you will be satisfied.”

Middle Earth Enterprises is actually owned and operated by Embracer Freemode, a subsidiary of Embracer Group. Freemode, led by CEO Lee Guinhard, is a games and entertainment company. In addition to purchasing The Lord of the Rings holding company, the Company also acquired Limited Run Games and Inc., Singtrix, during the second quarter. Wingefors noted during his presentation that Embracer now has four licensed Lord of the Rings games in production with outside developers.

Although the Q2 report did not provide specific details about Freemode’s operations in relation to Middle Earth Enterprises, its overview said that Freemode had “strengthening.”[ed] its support and leadership team to help the companies grow,” including the addition of three senior executives.

Overall, Embracer Group had a strong second quarter, with net sales up 190% to SEK 9,569 million (US$910 million) from July to September 2022. However, Wingefors cautioned that future net profit guidance may be revised down to 8.0 to 10. SEK 0 billion revised down (US$750-950 million) to reflect the global economic downturn. “All industries, including gaming, are expected to experience some impact from weaker consumer sentiment,” Wingefors warned in a statement accompanying the Q2 report.

As a result, Wingefors said Embracer Group’s board will initiate a “special audit” of the deal. One outcome could be that the board will recommend that some of the group’s subsidiaries – potentially including Embracer Freemode – be spun off into separate public companies “if doing so is deemed best for employees, creates greater shareholder value and our strategic flexibility.” improved. ”

Over the past 12 months, Embracer has embarked on a rampant acquisition spree, acquiring some of entertainment’s most prominent IPs, including Dark Horse Comics, which released titles like The Mask and Stranger Things last December, and video game studio Crystal Dynamics, the Heard Tomb Raider last May. Just last month they also acquired Anime Ltd, a UK-based distributor of Japanese entertainment, including animation, music and merchandise.

Despite the bleak economic outlook — and Sweden’s currency, the krone, which fell to an all-time low against the US dollar in September — Embracer is still open to buying more companies. When asked if Wingefors had ruled out making “major acquisitions in the foreseeable future,” the CEO replied, “I don’t think you should rule out transactions. In general, I’d like to be active in the market, but it’s difficult to make very large acquisitions when you have your currency [is] estimated as it is currently. It could destroy shareholder value. But if there’s a fantastic, very large company that’s willing to sell at significantly lower valuations, then of course I’m here to speak.”

https://variety.com/2022/film/global/lord-of-the-rings-embracer-future-plans-1235435329/ New Lord of the Rings owner Embracer hints at future plans

Charles Jones

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