DNB owns 770 million shares – E24

DNB Asset Management owns 2.5 percent of the billion-dollar Embracer Group, which still owns companies in Russia.

Swedish gaming company Embracer has four subsidiaries in Russia with a total turnover of more than SEK 350 million, according to the company. Swedish Radio.

Radio channel P4 Värmland has obtained information from the Russian tax authorities, and reports that all four affiliates have increased their turnover in 2022 – one of them by up to 400%.

The Swedbank Robur Fund is among the investors in the gaming giant.

Karina Sesser-Nylund, Swedbank’s CIO, describes Empresser’s presence in Russia as “problematic”.

– In the long term, we do not view the companies in which we invest as continuing operations in Russia, she tells Sveriges Radio.

DNB: You called

While Swedbank holds a 2.10 percent stake, Norway’s DNB Asset Management (DNB AM) has a 2.47 percent stake in the gaming giant. At today’s share price, this corresponds to an investment of approximately NOK 770 million.

Communications consultant Vidar Korsberg-Dalsbo confirmed that they are in contact with Embracer on the Russia issue.

– DNB AM works to influence the business practices of companies where we feel there is an opportunity for change, rather than excluding it from our investments. Over a longer period, we have had dialogue with many companies about their ties to Russia and we see that many of them have backtracked or pulled away.

“We’ve contacted Embracer Group AB to talk to the company about its exposure to the Russian market,” Dalsbø wrote in an email to E24.

Dalsbø adds that many issues related to Russia are being taken up by DNB pursuing its own sanctions, and points out Group Guidelines for Responsible Investments.

– DNB AM is keen to limit our exposure to Russia – directly and indirectly. Basically, companies with direct exposure are largely subject to sanctions, while there are a number of companies with indirect exposure to the country, such as Embracer Group AB.

condemns war

It has four subsidiaries with a total of 891 employees in Russia, Beatrice Forsgren, communications director at Embracer wrote in an email to E24.

These work with game development for studios and publishers in other countries, as well as support duties.

– We do not have a publishing business in Russia, we do not have direct sales and we do not own any intellectual property rights (trademarks) in the country, Forsgren writes.

She explains that the Russian subsidiaries are called cost centers, so the sales volume in the four companies is not based on sales in Russia, but is reported as sales within the group.

– For Embracer, this means limited profit in Russian companies, and therefore also limited income tax in Russia.

Embracer has not responded on whether it would be appropriate to scale back operations in Russia, or whether shareholders other than DNB have made contacts about the same issue.

in another email Swedish Radio However, the company writes that it does not comment on any transfer or closing until it is completed.

“Disposing or moving a business is very complex and could, for example, lead to a deterioration in the security situation or reprisals for employees or their relatives.”

Embracer’s main owner and founder, Lars Wingefors, posted in March last year a permit He says he is “very sad and worried about the inhumane and aggressive war” in Ukraine.

Reverse Swedish Radio Embresser also wrote that they “condemn Russia’s brutal war of aggression against Ukraine,” adding that they have acted in line with all sanctions against Russia since they were imposed.

inventory breakdown

Since 2011, the Embracer Group has grown exponentially through the acquisition of other game development companies and their associated intellectual property rights.

That’s how they ended up with more than 138 in-house game development companies in more than 40 countries, and more than 16,500 employees, according to their company. sites.

It also includes the rights to 850 games, including popular titles like Borderlands, Duke Nukem, Tomb Raider, Valheim, and Saints Row.

The company also purchased all rights to the Lord of the Rings trademark.

The group had turnover of SEK 9.4 billion in the fourth quarter of the fiscal year, and was left with an EBITDA of just over SEK 2 billion.

In May, Embracer shares plunged nearly 40 percent on Nasdaq Stockholm after announcing a $2 billion mega deal. It had gone down a drain on the upstream side.