(Bloomberg) -- Shares of Embracer Group AB gained as much as 18% as trading got underway in Stockholm after announcing plans to split itself into three publicly traded companies. 

The Swedish game developer that owns rights to Tomb Raider and a suite of products related to The Lord of the Rings says it’s taking the step in order to unlock more value.

Embracer Group AB’s tabletop games publishing and distribution will be handled by Asmodee Group, which is expected to list within the next 12 months. A stock listing for Coffee Stain & Friends, which will focus on indie and free-to-play games for PC, console and mobile use, is expected in 2025. Shares of both will be distributed as a dividend to Embracer’s shareholders.

Middle-earth Enterprises & Friends, which develops and publishes top tier games for PC and console, including products related to The Lord of the Rings and Tomb Raider, will remain inside Embracer, which will be renamed.

“There is significant untapped potential within the group, which I am confident the new structure will unleash,” Chief Executive Officer Lars Wingefors said in an open letter on Monday, adding that he will remain “a long-term, active, committed and supportive” owner of all three companies. He intends to form a new ownership structure, which will include his roughly 20% of capital and 40% voting stake in Embracer.

After years as a prolific deal maker in an era of zero interest rates and rising stock markets, Embracer’s fortunes took a turn for the worse in 2023, when a partnership deal worth over $2 billion collapsed. That saw 45% erased from the share price in a single day as the company cut profit forecasts, subsequently embarking on a restructuring program to reduce debt.

Through Asmodee Group, Embracer has entered into a new financing agreement for €900 million ($960 million), with proceeds earmarked for repaying existing debt and reducing leverage within the remaining Embracer Group.

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