Embracer Group AB
As of today, Embracer has an enterprise value of $4.5 billion earning roughly $1 billion in EBITDA annually thanks to a wild decade of significant M&A including the $3 billion acquisition of Asmodee in March 2022. The capital destruction has been impressive yet today the company has finally come to their senses after a mega deal fell through earlier in 2023.
In July, Embracer embarked on a restructuring plan that would wind down low performing ROI assets that drained cash out of the business.
“we have accelerated processes to divest assets relative to external funding for individual games” - Lars Wingefors, CEO
Today Embracer has it all - from low valuation to quality IP. A renewed focus on cash conversion and free cash flow while deleveraging back to net debt/EBITDA of 1x. These actions make Embracer a very compelling and asymmetric investment opportunity today much akin to the transition that Meta and Amazon embarked on last year.
Contents:
Overview of Embracer
Restructuring
Financials
Valuation
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