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Embracer Group has agreed to buy Perfect World Entertainment from China’s Perfect World for $125 million in cash and stock.

Under the deal, Embracer will pick up Perfect World Publishing and Cryptic Studios, which together have 237 employees. The larger Chinese company will continue operating on its own.

Under the deal, Sweden’s Embracer Group is acquiring the studios in Redwood City, California (Perfect World Publishing) and Los Gatos, California (Cryptic Studios), as well as a quality assurance and localization office in Amsterdam.

Embracer is paying $60 million in cash and $65 million in B shares of Embracer stock. The acquired studios will become part of Embracer’s Gearbox Software division. It’s one more acquisition in a long list that has made Embracer one of the most active acquirers in games. China’s Perfect World has a market value of $5.9 billion, while Embracer is valued at $10 billion.


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Founded in 2000, Cryptic Studios has experience launching and operating multiple MMOs (Massively Multiplayer Online Games) including  Neverwinter and Star Trek Online. Cryptic has a team of 136 employees. And founded in 2008 and headquartered in Redwood City, California, PWE Publishing is known for publishing leading PC and console titles based on well-known global entertainment franchises such as the Star Trek and Dungeons & Dragons games by Cryptic Studios.

Above: Your Temporal Battlecruiser Paladin Class will still work.

Image Credit: Perfect World

PWE Publishing’s product portfolio also includes the popular Torchlight series, as well as Remnant: From the Ashes, in partnership with Embracer-owned development studio Gunfire Games. PWE Publishing has a team of 101 employees.

“It’s an honor for us to welcome this talented group of individuals into the Gearbox Entertainment family. Gearbox will invest into the future of Cryptic as an independent, dynamic studio that is passionate about MMOs. That commitment is paired with an exciting new partnership that will emerge as the talented Perfect World publishing team and their promising line up of future games will become supported and bolstered by the capability and strength of the Gearbox Publishing team,” said Randy Pitchford, founder of Gearbox Entertainment, in a statement.

Pitchford will be speaking at our upcoming GamesBeat and Facebook Gaming Summit on January 25.

During 2021, PWE had operating losses stemming from the cancellation of Cryptic’s newest MMO (Magic: Legends) and a gap in PWE Publishing’s release schedule. Embracer is highly confident that under its leadership, both Cryptic and PWE Publishing will be strong financial contributors in addition to their strategic value with new IP and an MMO capability that has been missing from Embracer’s portfolio.

Cryptic Studios currently operates three longstanding MMOs (Neverwinter, Star Trek Online, and Champions Online) with a shared life span of as much as 25 years. These titles generate significant profits, and Embracer expects the live Cryptic titles will continue to be strong and steady for the upcoming years.

PWE Publishing has a compelling slate of upcoming games while continuing to evaluate new opportunities. Of the existing slate, PWE’s next launch is planned in 2022 with five additional releases by 2024.

“It has been an amazing journey being a part of Perfect World, and we thank them for all of their support throughout the years,” said Yoon Im, CEO of PWE, in a statement. “PWE is delighted to become a part of the Embracer family, and join Gearbox on their mission to entertain the world. We are eager to apply our vast experience and talents to benefit both shareholders and customers around the world.”

In the past two quarters, Embracer Group has bought or announced the purchase of 17 other companies.

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