Embracer Group Results Presentation Deck
EARNOUTS AND APM UPDATE
Example of a typical earnout structure
Embracer has made an agreement to acquire a game studio with a deal term of total 1,500. 600 will be paid at day of closing and 900 is future
payments pending on earnout agreements.
Of the total earnout of 900, 300 is connected to that key employees are still employed three years from closing. Hence, this part is excluded
from the purchase price in the PPA and will be accounted as personnel expenses.
The remaining 600 of the earnout is contingent to financial targets from the day of closing to the three-year anniversary of closing. This earnout
is part of the purchase price in the PPA.
Total purchase price in the PPA sums therefore up to 1,200.
Day 1 consideration
Earnout contingent to future employment
Earnout contingent to financial targets
Sum
Deal terms
600
300
600
1,500
Purchase price under IFRS
600
0
600
1,200
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