The desert kingdom continues to make big strides in video games – and the acquisition of Embracer Group is just one of them.

 

 

The Kingdom of Saudi Arabia has made another major investment in the video games industry, investing more than $1 billion to acquire an 8.1% stake in the Swedish games giant Embracer Group. According to MarketWatch, the shares will be sold to Savvy Gaming Group, a subsidiary of the country’s sovereign wealth fund focused on games and e-sports.

“Savvy Gaming Group’s investment of $1 billion enables us to continue executing our strategy proactively from a position of strength across the global gaming industry,” Lars Wingefors, CEO of Embracer Group, said in a press release.

“Over the past few years, Saudi-based entities have become one of the most significant investors in the global gaming market, and the games market in MENA [Middle East – North Africa] is one of the world’s fastest-growing, with $5.7 billion in 2021 revenues and more active gamers than either the US or Western Europe.”

“The largest country in this market, by far, is Saudi Arabia, and having visited Saudi Arabia, I have seen the gaming community and the opportunities firsthand. Our relationship with Savvy Gaming Group will enable us to set up a regional hub in Saudi Arabia, from which we will be able to make investments across the MENA region, either organically, via partnerships, joint ventures, or via acquisitions of companies led by strong entrepreneurs,” he said.

Saudi Arabia has already made several significant moves in the gaming space in 2022, both through the sovereign wealth fund and the Electronic Gaming Development Company, which together made substantial investments in Capcom, Nexon, Nintendo, ESL Gaming and SNK before the Embracer deal.

Embracer, however, is the biggest of them all: not as a household name as Electronic Arts or Activision, it has quietly grown into an industry giant.

In May, it acquired Crystal Dynamics, Eidos Montreal and Square Enix Montreal, adding them to a list that also includes Koch Media and Deep Silver, Saber Interactive, Gearbox, 3D Realms, Perfect World and others.

“This investment in Embracer Group is a starting point for a long-term commitment to the company,” said Brian Ward, CEO of Savvy Gaming Group. “The Embracer team has built a truly unique and leading ecosystem of entrepreneurs and creators at a scale which we believe will continue to generate enormous value for the games community in the coming years.”

Both the Public Investment Fund and the Electronic Game Development Company are controlled by Mohammed bin Salman, Crown Prince and de facto ruler of Saudi Arabia. In 2021, US intelligence agencies determined that bin Salman may have approved the 2018 murder of Saudi journalist Jamal Khashoggi, who was tortured, killed and dismembered while at the Saudi Arabian consulate in Istanbul, Turkey. Despite the finding, neither the United States nor other governments have taken any action against bin Salman.

Source: MarketWatch, Embracer Group