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The kingdom of Saudi Arabia has made another major investment in the videogame industry, investing more than $1 billion to acquire an 8.1% stake in Swedish gaming behemoth Embracer Group. The shares will be issued to Savvy Gaming Group, according to MarketWatch (opens in new tab), a games and esports-focused subsidiary of the country’s Public Investment Fund.
“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,” Embracer Group CEO Lars Wingefors said in a press release (opens in new tab). “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.”
Saudi Arabia has made a number of major moves into the game space in 2022, through both the Public Investment Fund and the Electronic Gaming Development Company, which between them have made significant investments in Capcom (opens in new tab), Nexon, Nintendo (opens in new tab), ESL Gaming (opens in new tab), and SNK (opens in new tab) prior to the Embracer deal.
Embracer is the biggest of them all, though: It’s not a household name like Electronic Arts or Activision, but it has quietly grown into an industry behemoth (opens in new tab); in May it acquired (opens in new tab) Crystal Dynamics, Eidos Montreal, and Square Enix Montreal, adding them to a roster 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,” Savvy Gaming Group CEO Brian Ward said. “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 Gaming Development Company are controlled by Mohammed bin Salman, the crown prince and de facto ruler of Saudi Arabia. In 2021, US intelligence agencies determined that bin Salman had approved the 2018 murder of Saudi journalist Jamal Khashoggi (opens in new tab), who was tortured, killed and then dismembered while inside the Saudi Arabian consulate in Istanbul, Turkey. Despite the finding, no action was taken against bin Salman by the US or other governments.
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