Embattled publisher Embracer Group has secured an extension on its credit and loan facilities to February and May 2025, respectively as it looks to clear its debts.
The combined nominal value is SEK 1.7 billion ($166.2 million), with an agreement to pay SEK 2.6bn ($254.1m) back through quarterly payments up to January 2025.
In its Q2 financial report ending September 30, 2023, Embracer noted that its net debt stood at SEK 14.6bn ($1.4bn). The expected interest rate on the total debt is approximately 6.15%.
The publisher previously said it hopes to almost halve its net debt to SEK 8bn ($783.2m) by the end of the financial year.
Financial flexibility
"We are pleased to further strengthen Embracer’s financial flexibility, which also demonstrates the confidence that our main banks and financial institutions have in our financial profile and strategy," said Embracer Group CEO Lars Wingefors.
"As part of the ongoing restructuring program, we have the ambition to reduce debt, both on a gross and net debt level. This credit and loan extension is aligned with our own agenda and puts us in a stronger position as we transition from heavy-investment mode to a highly cash-flow generative business."
Embracer has been making attempts to reduce its debt ever since a planned $2 billion investment into the company collapsed at the eleventh hour. The publisher had already banked on the cash to fund its deals and game production. It was later reported that the mystery partner was Saudi Arabia's Savvy Games Group.
This was followed by strained financials and vast restructuring and layoffs at the company. Subsidiaries including Gearbox Publishing, Cryptic Studios, Digic and Fishlabs, amongst others, all took a hit, culminating in 900 employees being let go. Studio closures to date include Free Radical Design, Volition Games and Campfire Cabal.
