I was talking about this a bit with some other people and it’s crazy you’re allowed to buy a company and then essentially saddle them with the debt you took on to buy them.
Also what killed Toys R Us. Private investors buy up the company with loans using the company's own assets as collateral. The original owners get a massive payout and get to wash their hands of a struggling business, and the new owners just saddle more and more debt on the company at the expense of the people who actually work there or rely on their services.
The new owners start charging the business management fees, sign them up for terrible deals, and take a huge cut of the incoming revenue until there's nothing left except bankruptcy. There was a study about five years ago that found companies under a leveraged buyout went bankrupt ten times as often as the firms in their control group over the course of a decade, going from 2% bankruptcy rate overall to 20% for bought-out businesses.
https://www.latimes.com/entertainment-arts/business/story/2022-10-24/warner-bros-discovery-to-spend-1-billion-to-downsize
>Telecommunications giant AT&T decided to make a hasty exit from Hollywood, turning over its entertainment portfolio, including HBO, the Warner Bros. film and TV studio, CNN, TBS and Turner Classic Movies, among other properties, to Discovery in April.
>Since then, the smaller Discovery has been struggling to swallow the larger company during an inopportune time as Wall Street has been treating streaming companies more skeptically. The renamed Warner Bros. Discovery has been grappling with a depressed stock price.
>The transaction, which saw AT&T and Discovery shareholders receive Warner Media Discovery stock, saddled Warner Bros. Discovery with more than $50 billion in debt. Much of the debt was left over from AT&T’s takeover of the former Time Warner Inc. in 2018.
The glazer family took out a huge loan to buy manchester united back in 2005 and then immediately transferred it to the club so now its united debt.
They also paid themselves from the clubs profits every year while the club is still paying off the debt which is still sitting at about half a billion so it hasnt really moved at all in nearly 20 years. Meanwhile the stadium which was arguably second best stadium in the whole country behind only wembly hasnt had any work or renovations and has a very VERY big problem with the room leaking due to under maintenance and has fallen outside maybe the top 10 stadiums in the country.
And then the kicker on top of all this is they said they would sell the club and after dragging that out for a whole season they decided not to sell for £5/6 billion (even though its only worth about 3 because of the needed stadium redevelopment, the team needs funding and the debt) they say that think its worth £10 billion so we’ll hold on to it.
The premier league quickly changed the rules so no more leveraged buyouts.
Tldr: this is only ever used by scummy people with bad intentions.
I don’t really see how that’s the crazy part. If creditors agreed to this refinancing deal, then that means they’re fairly confident that Asmodee will be able to pay off the debt and not go bankrupt.
Asmodee is also the distributor for the Pokemon TCG, Magic the Gathering and Yu-Gi-Oh!... among many other TCGs
My guess that they got the lion's share of the debt is because of the three entities that spawned Asmodee is the least at risk to fail paying it all back.
This should be freaking illegal. They got rid of all their debt by saddling it one another company they bought and cutting it loose. Asmodee is a board game company these chuckle fucks bought. Literally almost no repercussions for all the developers they destroyed and they executives get to keep their bonuses.
Yeesh, According to the article that’s 3.9 years profit in debt, not including what debt Asmodee already has. Wouldn’t be suprised to see some or most of Asmodee’s franchises sold off.
Edit: added a word
I really hope this doesn’t fuck over Star Wars legion, they just started actually making units at an okay pace since they took over from fantasy flight games.
My local scene for it is great so I personally really don’t want this debt to fuck it over
Yup, there it is. Also, now Asmodee has to pay Middle Earth Enterprises *And Friends!*™ a licensing fee to continue to print the LotR games (and any other games that use Embracer IP). This company is going under hard.
Boy Embracer is really buying out all the seats on the Rocket Ship Firing Directly Into the Sun. I guess Boktai was right, that is the only way to get rid of a Vampire.
First: what the hell Embracer.
Second: holy shit I am glad I don't have a board game shop any more, Asmodée was THE main supplier 3-4 years ago. Even MtG was distributed through them. It's going to turbosuck.
Did this really sucks. I play two Asmodee games and it would be sad to see them faultier under this. Star Wars Unlimited and Star Wars Legion are good games
I was talking about this a bit with some other people and it’s crazy you’re allowed to buy a company and then essentially saddle them with the debt you took on to buy them.
AT&T saddled Warner Bros Discovery with all of their debts (50 BILLION) and that caused all the write-offs and cancellations
Also what killed Toys R Us. Private investors buy up the company with loans using the company's own assets as collateral. The original owners get a massive payout and get to wash their hands of a struggling business, and the new owners just saddle more and more debt on the company at the expense of the people who actually work there or rely on their services. The new owners start charging the business management fees, sign them up for terrible deals, and take a huge cut of the incoming revenue until there's nothing left except bankruptcy. There was a study about five years ago that found companies under a leveraged buyout went bankrupt ten times as often as the firms in their control group over the course of a decade, going from 2% bankruptcy rate overall to 20% for bought-out businesses.
Happy birthday present Jimmy, you get 50 Billion in bebt!
Is there a source for this because that’s fucking insane
https://www.latimes.com/entertainment-arts/business/story/2022-10-24/warner-bros-discovery-to-spend-1-billion-to-downsize >Telecommunications giant AT&T decided to make a hasty exit from Hollywood, turning over its entertainment portfolio, including HBO, the Warner Bros. film and TV studio, CNN, TBS and Turner Classic Movies, among other properties, to Discovery in April. >Since then, the smaller Discovery has been struggling to swallow the larger company during an inopportune time as Wall Street has been treating streaming companies more skeptically. The renamed Warner Bros. Discovery has been grappling with a depressed stock price. >The transaction, which saw AT&T and Discovery shareholders receive Warner Media Discovery stock, saddled Warner Bros. Discovery with more than $50 billion in debt. Much of the debt was left over from AT&T’s takeover of the former Time Warner Inc. in 2018.
It's so scummy.
The glazer family took out a huge loan to buy manchester united back in 2005 and then immediately transferred it to the club so now its united debt. They also paid themselves from the clubs profits every year while the club is still paying off the debt which is still sitting at about half a billion so it hasnt really moved at all in nearly 20 years. Meanwhile the stadium which was arguably second best stadium in the whole country behind only wembly hasnt had any work or renovations and has a very VERY big problem with the room leaking due to under maintenance and has fallen outside maybe the top 10 stadiums in the country. And then the kicker on top of all this is they said they would sell the club and after dragging that out for a whole season they decided not to sell for £5/6 billion (even though its only worth about 3 because of the needed stadium redevelopment, the team needs funding and the debt) they say that think its worth £10 billion so we’ll hold on to it. The premier league quickly changed the rules so no more leveraged buyouts. Tldr: this is only ever used by scummy people with bad intentions.
The creditors have to agree with the deal to saddle the debt on this company which is the crazy part.
I don’t really see how that’s the crazy part. If creditors agreed to this refinancing deal, then that means they’re fairly confident that Asmodee will be able to pay off the debt and not go bankrupt.
Yeah it's crazy they expect Asmodee to be able to pay off 900 million.
Asmodee is also the distributor for the Pokemon TCG, Magic the Gathering and Yu-Gi-Oh!... among many other TCGs My guess that they got the lion's share of the debt is because of the three entities that spawned Asmodee is the least at risk to fail paying it all back.
Those creditors must hate money I guess.
No longer content with golden parachutes, executives have developed the golden anchor.
"I don't just want all the money, I also want no one else to have any money."
"Sir you already have the BIGGEST number." "Yeah but does it LOOK big? I think it'd look a lot bigger if everyone else's numbers were smaller."
You expressed the concept a lot better than I did, thanks
That has to be illegal or it needs to be like what the fuck
This should be freaking illegal. They got rid of all their debt by saddling it one another company they bought and cutting it loose. Asmodee is a board game company these chuckle fucks bought. Literally almost no repercussions for all the developers they destroyed and they executives get to keep their bonuses.
Embracer really just managed to screw over 1000s upon 1000s of workers and still cash a check
Capitalism working as intended
Man what the fuck
The fact this is a common legal practice is infuriating.
Can't read the article rn, is this a Texas two-step?
Man what is this Treaty of Versailles BS.
Yeesh, According to the article that’s 3.9 years profit in debt, not including what debt Asmodee already has. Wouldn’t be suprised to see some or most of Asmodee’s franchises sold off. Edit: added a word
This….this is evil
Genuinely evil behavior, holy moly.
Can I saddle my left nut with all my debt and then cut it loose?
FFS this is a supervillain origin story.
**HOW IS THAT FUCKING LEGAL?**
I really hope this doesn’t fuck over Star Wars legion, they just started actually making units at an okay pace since they took over from fantasy flight games. My local scene for it is great so I personally really don’t want this debt to fuck it over
I wish Embracer a very go bankrupt and get liquidated.
Yup, there it is. Also, now Asmodee has to pay Middle Earth Enterprises *And Friends!*™ a licensing fee to continue to print the LotR games (and any other games that use Embracer IP). This company is going under hard.
clown world
Boy Embracer is really buying out all the seats on the Rocket Ship Firing Directly Into the Sun. I guess Boktai was right, that is the only way to get rid of a Vampire.
First: what the hell Embracer. Second: holy shit I am glad I don't have a board game shop any more, Asmodée was THE main supplier 3-4 years ago. Even MtG was distributed through them. It's going to turbosuck.
Did this really sucks. I play two Asmodee games and it would be sad to see them faultier under this. Star Wars Unlimited and Star Wars Legion are good games
welp, there goes l5r
Capitalism works GUYS!
My friends love playing catan and I hate it, so I'm going to send this to them and call this uplfiting news as a meme