Take-Two Interactive Software agreed to buy The Gearbox Entertainment Company from Embracer Group AB on March 28, 2024. The deal closed on June 11, 2024. Gearbox became a wholly owned Take-Two subsidiary. Embracer received no cash. The entire consideration was newly issued Take-Two common stock.
That price was a steep markdown. Embracer had picked up Gearbox in April 2021 in a deal valued at up to $1.3 billion, including earn-outs. The roughly $460 million Take-Two paid represented a significant discount from that earlier valuation, ending months of speculation about Embracer's plans to shed the studio.
Randy Pitchford, who founded Gearbox in 1999 and serves as its CEO, stayed on to lead the studio after the transaction. The package included three shops, Gearbox Software, Gearbox Montreal, and Gearbox Studio Quebec, plus the Borderlands and Tiny Tina's Wonderlands franchises.
Deal Structure and Payment
Take-Two settled the entire purchase with freshly issued common stock. That turned Embracer Group into a Take-Two shareholder instead of a cash recipient. The stock-based structure conserved Take-Two's cash and tied Embracer's return to Take-Two's future performance.
The transaction was slated to close during the first quarter of Take-Two's fiscal year 2025, which ended June 30, 2024. It closed on June 11, 2024, within that window. Neither the exact share count issued nor any regulatory hurdles were disclosed.
Assets Included and Excluded
Take-Two gained three studios: Gearbox Software, Gearbox Montreal, and Gearbox Studio Quebec. The transaction also transferred the Borderlands franchise and Tiny Tina's Wonderlands. Borderlands is Gearbox's flagship series. Mainline entries and spin-offs have pulled in hundreds of millions of dollars across platforms.
Embracer held back Gearbox Publishing San Francisco, formerly Perfect World Entertainment.
That operation was rebranded Arc Games after the transaction closed. Embracer also kept the publishing rights to the Remnant franchise, Hyper Light Breaker, and other unannounced titles. Splitting the creative work from the publishing arm was a defining feature of the deal.
The retained assets left Embracer with a continuing publishing footprint, though without the studios that built its most valuable series. Arc Games continued to operate independently under Embracer's ownership.
Strategic Rationale for Take-Two and Embracer
The deal added a seasoned studio and a marquee franchise to Take-Two's portfolio. The company already owned 2K Games, Rockstar Games, and other labels.
For Embracer, the sale was triage. After a studio-buying spree from 2020 to 2022, the company watched its stock price collapse and its debt mount. A restructuring program announced in June 2023 triggered studio closures, project cancellations, and divestitures. Selling Gearbox at a loss relative to the 2021 purchase price became a necessary move to raise capital.
Because the consideration was stock, Embracer did not get cash to pay down debt directly. But the deal removed a significant cost center from its balance sheet and gave it a stake in Take-Two's future.
Leadership and Post-Closing Structure
Randy Pitchford stayed. He founded Gearbox Software in 1999 and led it through multiple ownership changes, including the 2021 Embracer deal and now the Take-Two transaction.
His retention preserved continuity for current projects. Gearbox continued to operate as a wholly owned Take-Two subsidiary, keeping its own branding and management structure. The three studios pressed ahead with existing work, including the next Borderlands title and other unannounced games. No post-closing layoffs or internal restructurings were disclosed.
The deal handed Take-Two direct control of one of gaming's most valuable looter-shooter franchises. Borderlands has sold more than 77 million copies worldwide as of 2023, according to figures Take-Two has reported publicly. The transaction also expanded development capacity for future releases across Take-Two's labels.
