Embracer buys rights to Tolkien-related IP, teases new LOTR movies

Magnify / A classic image of famed author JRR Tolkien, modified to reflect the new custodian of his most famous intellectual work as of this week’s megaton acquisition announcement.

Getty Images/Sam Machkovech

Swedish game publisher Embracer Group has grabbed headlines in recent years thanks to megaton acquisitions of video game studios, and on Thursday morning the company announced that it has grown even further. The latest round of acquisitions includes a surprising company outside its usual line of business: Middle-earth Enterprises.

This company is better known as the exclusive dealer of all Lord of the Rings and The Hobbit novels, along with all intellectual property derived directly from these JRR Tolkien fantasy masterpieces. The financial terms of this deal with former dealer Saul Zaentz Company were not disclosed, but Embracer is already eager to tease brand new movies featuring the aforementioned novels’ characters.

No production plans have been set for new films yet; Rather, Embracer says in a press release that they want to “explore more films based on iconic characters such as Gandalf, Aragorn, Gollum, Galadriel, Eowyn and other characters from JRR Tolkien’s literary works.” The agreement has a logical connection to Embracer’s existing business in the form of LOTR-themed board games already being produced by subsidiary Asmodee, while it’s hard to imagine Embracer not immediately assigning one of its many wholly-owned video game studios to the franchise in some way. Embracer has yet to propose plans to produce a Tolkien-themed video game. Instead, Thursday’s announcement hinted at “new opportunities for fans to explore this fictional world through merchandising and other experiences.”

It is important that this agreement does so not influence Amazon’s upcoming, high-budget Ringing with power TV Shows. That series’ pitch was led directly by the Tolkien estate and presented to various platforms before Amazon emerged with a winning bid, and the deal cleverly skirted Middle-earth Enterprises’ rights because it involved texts and materials not covered by the long-standing SZC -arrangement. Embracer suggests it “has financial interests” in the Amazon series, but it’s unclear if Embracer will see any cut in the production’s profits, or if they’re just benefiting from more publicity and attention to all things Tolkien.

There’s a lot of Embracin’

Embracer identified six other companies as acquisition targets, with four resembling traditional game development houses: Tripwire Interactive, the American studio responsible for Killing Floor and Maneaters series; Tuxedo Labs, a Swedish studio best known for the PC-exclusive destruction simulation game Tear down; Tatsujin, a Japanese developer staffed by developers from the arcade era with plans to work on series from the acclaimed Toaplan game library (especially the classic “shmup” Truxton and the beloved meme machine that is Zero Wing); and Bitwave Games, another Swedish studio with plans to both collaborate with Tatsujin and also make ports of NES-era classics like Sunsoft’s lost 8-bit gem Gimmick. The latter announcement appears to spoil at least one piece of news from a Sunsoft-related event scheduled for later Thursday.

Outside of formal game studios, Embracer’s three other named acquisitions appear designed to diversify the company’s game business portfolio. The most famous of these, Limited Run Games, has risen to prominence among gaming fans over the past five years thanks to its focus on physical game releases. Typically, Limited Runs open pre-orders for cassettes and discs of games that have previously been released as exclusive digital downloads; once the pre-order period is complete, the publisher usually closes orders for the game in question, especially since the games in question are often cult classics or niche favorites (although it occasionally publishes games from major game studios, especially certain versions of games in Downfall series). Embracer did not indicate in its acquisition announcement that it plans to change Limited Run’s business model.

Embracer is also acquiring Singtrix, a karaoke system manufacturer launched by patent holders previously involved in Guitar hero series. The acquisition announcement does little to clarify what consumers can expect from an Embracer-powered Singtrix, other than a suggestion that the company is working on “the next pop culture musical experience,” which may or may not involve a future video game-like project. There’s a chance that Embracer’s third non-studio acquisition, European peripheral maker Gioteck, could help Embracer build some sort of physical musical peripheral to match what Singtrix is ​​whipping up, but that’s just speculation at this point.

In addition to all these announcements, Embracer buried news of another acquisition of game studio that it is not prepared to announce “due to commercial reasons.” Instead, Embracer suggested that this unnamed studio is considered “the third or fourth largest” game studio it entered into plans to acquire today – suggesting that it is not necessarily a massive studio. (If this were the third or fourth largest acquisition in the company’s history, however, it would be worth no less than $525 million, which is what it paid for all of Saber Interactive in early 2020.)

Thursday’s news follows the shocking announcement in May that Embracer had acquired the entire western business of Square-Enix, and those studios’ lucrative IP (including the Tomb Raider, Legacy of Kain, and Deus Ex series), for just $300 million. That announcement included confirmation that the studios were moving forward with games in both the Tomb Raider and Deus Ex franchises, though neither Embracer nor its newly-owned studios have revealed anything more about such games since the May news broke. It followed the acquisition of well-known game studios such as Gearbox Entertainment (Borderlands), 4A games (Metro Exodus), and Deep Silver Volition (Saint’s Row, Red faction).

Leave a Reply

Your email address will not be published.