Embracer splits into two, keeps Tomb Raider and Lord of the Rings
Lord of the Rings and Tomb Raider are moving into a stronger vault as Embracer splits again, leaving the real question of which franchises are now safer.
Embracer Group is carving itself up again, and this time the crown jewels are going with the new name. Lord of the Rings, Tomb Raider, Metro, Dead Island, Deus Ex, TimeSplitters, Thief and Legacy of Kain are set to sit under Fellowship Entertainment, while the remaining Embracer side keeps Destroy All Humans, Desperados, Gothic, Killing Floor, Kingdom of Amalur, Wreckfest and licensed work such as Hot Wheels Unleashed and SpongeBob SquarePants.
The company said on May 20, 2026 that it intends to split into two publicly listed companies on Nasdaq Stockholm, with Fellowship Entertainment planned for a 2027 listing. Embracer will start reporting through two business segments, Fellowship Entertainment and Embracer, beginning with Q1 FY 2026/27, and it has already started recruiting a CEO and CFO for the Embracer side, with appointments expected well before the spin-off.
Chairman Lars Wingefors framed the move as a reset around value and focus. In his open letter, he said Fellowship Entertainment’s assets are “among the most undervalued in the industry” and argued the split would create “sharper management focus and clearer accountability.” That is the language of a company trying to convince investors that its biggest IPs will be easier to understand, price and push when they are no longer bundled with everything else.
The practical read for game fans is less about corporate structure than about where future bets may land. Tomb Raider, Deus Ex and Legacy of Kain now sit inside a tighter IP vault, which could make revival pitches easier to greenlight if Fellowship decides to concentrate on prestige franchises with long tails in games, licensing and transmedia. By contrast, the surviving Embracer side looks more like a basket of mid-tier series and licensed projects, the kind of catalog that can still work, but tends to need more careful prioritization.
This is only the latest turn in a longer unwind. Embracer first announced a plan on April 22, 2024 to become three standalone listed entities, then spun off Asmodee Group in February 2025, while Coffee Stain Group was later treated as its own planned listing. That breakup followed the company’s 2022 buying spree, when Embracer acquired Crystal Dynamics, Eidos-Montréal, Square Enix Montréal and IP including Tomb Raider, Deus Ex, Thief and Legacy of Kain, adding about 1,100 employees. After a roughly $2 billion partnership and investment deal collapsed in 2023, Embracer launched a restructuring program aimed at reducing debt and improving cash conversion.
The lesson is blunt: after years of acquisition-fueled expansion, Embracer is still deciding which franchises deserve a stronger vault and which are safer left outside it.
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