Embracer splits again: Fellowship Entertainment takes Lord of the Rings, Tomb Raider, and more
Embracer Group is breaking itself up again. The Swedish gaming holding company announced on May 20, 2026, that it will spin off its marquee IP portfolio into a new publicly listed entity called Fellowship Entertainment, targeting a Nasdaq Stockholm debut in calendar year 2027. It's the second major restructuring in three years from a company that has spent much of the past decade acquiring studios at speed — and shedding them almost as fast.
The split
Fellowship Entertainment gets the crown jewels: Lord of the Rings and The Hobbit, Tomb Raider, Kingdom Come: Deliverance, Metro, Dead Island, Darksiders, and Remnant, along with the studios attached to those franchises. On illustrative figures for FY 2025/26, Fellowship would have posted SEK 4.39 billion (roughly $400 million) in net sales with 2,169 employees per Embracer.
The remaining Embracer entity keeps a separate roster of smaller and mid-tier franchises — Arizona Sunshine, Biomutant, Gothic, Killing Floor, Titan Quest, Wreckfest — with a stated focus on cost discipline and what the company calls "experienced entrepreneurs." Full details on how debt is split between the two companies haven't been disclosed yet; a prospectus is expected ahead of the 2027 listing.
Phil Rogers, formerly of Eidos and Square Enix, is set to lead Fellowship alongside the existing management team.
The pipeline
The spin-off lands at an unusually busy moment for the franchises involved. On the same day as the announcement, Warhorse Studios — the Czech team behind Kingdom Come: Deliverance — confirmed it is developing both a new Kingdom Come title and a large-scale open-world RPG set in Middle-earth. Neither has a release date.
Beyond games, 2027 is shaping up as a big year for the IP itself. A Prime Video Tomb Raider adaptation is expected in early 2027, and Warner Bros.' Lord of the Rings: The Hunt for Gollum is slated for December 2027 according to Variety. Fellowship Entertainment will own the licensing rights that sit behind both projects.
The context
This is Embracer's second public restructuring since 2023. The company already spun off Asmodee in February 2025 and Coffee Stain & Friends the same year. Before that, it wrote off over a billion dollars in assets and cancelled dozens of games between 2023 and 2025, including — buried in the latest report — a 1.2 billion SEK (~$127 million) write-down tied to a large unannounced title, almost certainly the long-in-development action-RPG from Eidos-Montréal.
The stated logic for the split is to let each business focus more sharply and "capture the full potential" of its assets. Whether Fellowship can deliver on a Lord of the Rings open-world game, a Tomb Raider series, and a Gollum film simultaneously — as a newly independent company — is the question investors will be weighing when the listing arrives.
You might have heard the rumours, it's time to reveal what we are working on.
— Warhorse Studios (@WarhorseStudios) May 20, 2026
?️ An open world Middle-earth RPG.
⚔️ A new Kingdom Come adventure.
We’re excited to tell you more when the time is right.#WarhorseStudios #Annoucement #lotr #KingdomComeDeliverance pic.twitter.com/Pcgf9SqW52
