US video game publisher Take-Two Interactive Software said on Wednesday it would acquire Gearbox Entertainment, best known for the first-person shooter game Borderlands, from Sweden’s Embracer for $460 million.
The Swedish group is selling the game developer at a steep discount after buying the company in 2021 in a deal that valued the company at up to $1.4 billion.
In a separate statement, Embracer said the deal with Take-Two would reduce net debt by approximately 3.2 billion kroner to 3.5 billion kroner and that Embracer expected the transaction to be immediately accretive to free cash flow generation.
Embracer, the owner of the Tomb Raider video game franchise, has been undertaking a restructuring program since last year to reduce its debt. However, last month Embracer said its net debt target of 8 billion Swedish crowns ($753.22 million) for March might not be met.
Gearbox will operate as a studio within 2K, a publishing label owned by Take-Two, and will be led by founder and CEO Randy Pitchford, Take-Two added.
Reuters reported last year, citing people familiar with the matter, that Embracer had been considering options for Gearbox Entertainment as it looked to shore up its finances.
The Swedish company suffered a setback in May last year when a $2 billion partnership deal with an unknown company fell through, prompting it to announce a major restructuring plan in June. ($1 = 10.6233 Swedish Krona) (Reporting by Rishabh Jaiswal in Bengaluru; Editing by Janane Venkatraman)
Tags: TakeTwo Interactive acquires Borderlands maker Gearbox million March
