Frisco-Based Video Game Maker Gearbox Acquired for $460M

Three years after being acquired by Sweden's Embracer Group in a deal valued at up to $1.3 billion, Gearbox has a new, NYC-based owner in Take-Two Interactive.

Gearbox founder Randy Pitchford launched the company in 1999, It's getting bought by global games giant Embracer.

Frisco-based game maker Gearbox Entertainment is being acquired by New York City-based Take-Two Interactive Software  in a deal valued at $460 million, in a deal consisting entirely of newly issued shares of Take-Two common stock.

Take-Two, one of the world’s largest interactive entertainment companies, is acquiring Gearbox from Sweden-based Embracer Group, which acquired Gearbox in 2021 for a deal valued at the time at up to $1.3 billion.

“Joining forces with Take-Two Interactive and 2K will help Gearbox ascend to our next level,” Randy Pitchford, founder and CEO of Gearbox Entertainment, said in a statement. “Take-Two and 2K have demonstrated repeatedly their commitment to our engine of generating creativity, happiness, and profit. We set the bar for interactive entertainment and achieved remarkable results with groundbreaking, record-setting games when we worked together at arm’s length as partners. I’m incredibly excited about what we can accomplish now that we’re fully aligned as one.”

Take-Two said the purchase price assumes a debt-free, cash-free company with a normalized level of net working capital (excluding cash) at the time of the closing of the acquisition. The acquisition should be completed by June 30, Take-Two added.

Gearbox will operate as a studio within 2K and will be led by Pitchford and his management team. The acquisition adds a “robust and proven development team” to 2K’s incredibly talented developer community, including personnel that have worked together on multiple critically and commercially successful games.

Gearbox operates studios in Frisco; Montreal, Canada; and Quebec City, Canada.

The Calypso Twins are featured in Gearbox’s Borderlands 3 [Image: Gearbox Software and 2K Games]

Expanding proven video game franchises

“Our acquisition of Gearbox is an exciting moment for Take-Two and will strengthen our industry-leading creative talent and portfolio of owned intellectual property, including the iconic Borderlands franchise,” Strauss Zelnick, chairman and CEO of Take-Two, said in a statement. “This combination enhances the financial profile of our existing projects with Gearbox and unlocks the opportunity for us to drive increased long-term growth by leveraging the full resources of Take-Two across all of Gearbox’s exciting initiatives.”

Take-Two said it expects the deal will deepen its successful relationship with Gearbox Entertainment and to provide increased financial benefits through a fully-integrated operational structure. Take-Two will acquire Gearbox’s extensive portfolio of intellectual property, including full ownership of the critically and commercially acclaimed Borderlands and Tiny Tina’s Wonderlands franchises1, as well as Homeworld, Risk of Rain, Brothers in Arms, Duke Nukem, and Gearbox’s future pipeline.

Currently, Gearbox has six key interactive entertainment projects in various stages of development, including five sequels, two of which are from the Borderlands and Homeworld franchises, and at least one exciting new intellectual property. Beyond these plans, Take-Two said it believes that there are incremental opportunities to invest in new projects and to expand Gearbox’s proven franchises.

“With nearly 20 years of history working together, Gearbox has played an integral role in our success, given their unique ability to create interactive entertainment experiences that feature beloved characters, exciting new worlds, and humorous storytelling,” 2K President David Ismailer said. “We’re thrilled to welcome Randy Pitchford and his team of passionate, talented developers to 2K and we look forward to releasing numerous projects in the future as colleagues. We have loved partnering with Gearbox on every iteration of the Borderlands franchise and are excited to be in active development on the next installment in the series.”

Depreciation and restructuring

According to, selling Gearbox for $460 million reflects a significant depreciation from the potential $1.3 billion Embracer acquired it for in 2021. The B2B site reported that Embracer had to pay $363 million upfront to acquire the studio, $175 million of which was in Embracer shares, with the rest of the potential acquisition cost set to be based on performance.

PocketGamer said that selling Gearbox three years later is part of Embracer’s restructuring, which geared up after the group’s share price dropped 45% last spring. Embracer has laid off 1,400 staff across its studios, PocketGamer added.

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