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Embracer boss issues lengthy statement on Saudi fund’s £840m stake

Lars Wingefors, the boss of Embracer Group, has issued a lengthy statement discussing the recent £840m investment in the company by the Savvy Gaming Group, a subsidiary of Saudi Araba’s controversial Public Investment Fund.

Founded in Sweden, Embracer is the enormous umbrella corporation which owns more than 100 studios including Borderlands developer Gearbox, publishing groups such as THQ Nordic, Koch Media and Saber Interactive, and franchises such as Tomb Raider and Deus Ex.

The Savvy Gaming Group (SGG), meanwhile, is a gaming-focused arm of the Saudi investment fund set up by the hugely controversial Prince Mohammed bin Salman, in a bid to diversify and modernise the country’s foreign incomes.

Embracer now owns Tomb Raider, among many other franchises.

Its investment in Embracer, first reported last week, amounts to 8.1 percent of the company’s overall shares, with 5.4 percent of voting rights.

Saudi Arabia now owns similar chunks of various other game developers, including EA, Activision Blizzard, Take-Two Interactive, Capcom, and Nintendo, but each time it happens, eyebrows are again raised.

“Since our announcement two days ago regarding the investment by Savvy Gaming Group (SGG) I have received many questions,” Wingefors’ lengthy statement begins. “I would like to share some background and to provide you with a rationale for our decision. I understand and respect that there are different views on this topic. I don’t claim to have the right answers, but I want it to be clear that this decision was not taken lightly. I appreciate this opportunity to explain my view on why this investment is an important step for Embracer on our continued journey as a company.

“I want to be clear that Embracer will continue to be operated by me, our operative CEOs and management teams across the entire Group. Embracer is built on the principles of freedom, inclusion, humanity and openness. The transaction with SGG will not change this in any way.”

Wingefors said the investment signified support of Embracer’s current strategy rather than a bid to change it.

“I have been asked over the past few days why we are accepting investment from an entity in a non-democratic country,” he continued. “To start, we need to look ourselves in the mirror, we are a public company and already have many hundreds of institutions from all parts of the world as shareholders, including investors from the Middle East and Africa (MENA) and Asia region. Many of them have participated in the capital raising during the past years. Many others have joined over the open market.

“During the process, we have learned that the SGG parent, PIF, is one of the world’s largest investors, including sizeable ownership in many of our larger gaming peers. We genuinely believe that SGG, a fully commercial entity, has ambitions within gaming that are genuine in supporting the global ecosystem for our industry that are consistent with and important to the values and culture of our industry. SGG is providing a sizeable, truly long-term capital investment to support our strategy and our management so that we may continue the successful growth of our commercial businesses. My values as a Swedish entrepreneur are unwavering. We are a value-based company, and our commitment to a decentralised operating model that empowers great people to make their own decisions will always remain.”

Saudi Arabia – and its Prince Mohammed bin Salman in particular – has been blamed by the CIA for the assassination of Washington Post journalist Jamal Khashoggi. His rule has seen the country keep its notoriously poor human rights record, with homosexuality still criminalised with punishments ranging from floggings to the death penalty.

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