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Asmodee to Acquire Fantasy Flight Games

W. Eric Martin
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Three months after the merger of Days of Wonder into the Asmodee Group, another big deal in the games industry is going down, namely the merging of U.S. publisher Fantasy Flight Games into that very same Asmodee Group.

As announced today by FFG, Asmodee and Fantasy Flight Games have a "pending merger of the two companies", and while the terms of the deal weren't disclosed in the announcement, the press release does mention that FFG CEO Christian T. Petersen "will continue as the CEO of Fantasy Flight Games while also becoming a significant shareholder of the combined entity". Petersen explained the nature of the merge in a bit more detail via email: "All existing shareholders of FFG will be selling their shares to the Asmodee Group. I will be reinvesting the majority of my personal proceeds into Asmodee, taking a significant position in the group."

While this announcement will undoubtedly come as a surprise to most in the games industry, FFG and Asmodee have been talking about this possibility on and off since 2010, according to Petersen. "It was very important to me that such an event be a win for FFG's shareholders, for our staff, for our partners, and for the customers — the gamers without whom FFG never would have been," he wrote. "Last February [2014], at the New York Toy Fair, Stéphane Carville (Asmodee's CEO) approached me with a very compelling vision for how to positively merge the two companies that achieved these goals."

That vision works along the same lines as the Asmodee/Days of Wonder deal, with Fantasy Flight Games operating as an independent brand and publishing entity within the Asmodee Group. According to Petersen, "None of FFG's product plans are affected by the merger, and we anticipate that none of our licensing partnerships will be affected. I'm hugely excited for customers to get their hands on games like Star Wars: Imperial Assault, XCOM: The Board Game, Star Wars: Armada, The Witcher, and Eldritch Horror: Mountains of Madness (not to speak of the future releases we're developing for X-Wing, our LCGs, etc.). We've worked hard on these games, and I'm really proud of the FFG teams and of the product."

"The merger will allow FFG's design and development staff to continue work on games that are true to FFG's unique vision for hobby games," Petersen continued. "In fact, it will allow us to dedicate more resources and focus on the 'large and ambitious' games that are the core of our DNA. Other companies in the Asmodee Group will explore games aimed at the mass [market] and other game categories (such as abstract games), allowing FFG to concentrate on what we do best. This is quite liberating."

As for what might be different under the FFG label in the future, Petersen noted, "You'll probably see a few suitable games from FFG's catalog find their way to other publishers in the Asmodee Group, and vice versa."

So if FFG is going to remain independent, aside from small changes like, say, Ingenious bearing the Asmodee label or Claustrophobia migrating to FFG — and I'm just gassing here, not identifying changes that will actually happen — why make the deal in the first place? What benefits will emerge from the merge?

The press release notes that the "Asmodee Group of game companies will gain access to Fantasy Flight Games' strong sales, operational, and marketing infrastructure in North America, as well Fantasy Flight Games' almost-20 years of expertise in game development and multi-language game manufacturing". What does that mean in more practical terms? "After the merger, I believe that FFG will be the largest, oldest, and most experienced game publisher in the Asmodee Group," Petersen explained. "FFG produces hundred of new SKUs every year, and we coordinate manufacturing and localization across dozens of languages. Over the years FFG has developed and invested in many processes, manufacturing techniques, and propriety software applications to handle and oversee operations unique to the business of global games publishing.  We hope to make many of these tools, processes, and know-how available to the other companies in the group, which in turn should enable them to pass more value along to gamers."

And speaking of other languages, the press release notes that FFG will benefit from Asmodee's "distribution and marketing reach in Europe, greatly improving its product placement and organized play initiatives across the Continent." As Petersen explained, "We are able to do a great deal of support in English for our games (especially our LCGs). This merger will allow us to invest more in European organized play (OP) so there's more, and faster, tournament support (via localized tournament and game night kits), judges, and special events. Our hope is, sometime in the future, to have dedicated Asmodee staff in Europe that can provide great OP experiences for players across the Continent."

But what about FFG's products in other languages? Right now Fantasy Flight Games licenses titles to Edge Entertainment for release in French and Spanish; to Heidelberger Entertainment for release in German; and to Wargames Club, Game Harbor and Swan Panasia for release in Chinese. The Asmodee Group has multiple subsidiaries around the world — Asmodee GmbH in Germany, Asmodee France, Asmodee China, Asmodee Ibérica in Spain, Asmodee US, etc. — with those subsidiaries releasing titles in those very languages, so what's the future of those existing relationships? Petersen says that Heidelberger and Edge Entertainment "will continue to localize and represent FFG" for those markets and "will work with the respective Asmodee divisions to increase marketing and organized play support for those countries". Heidelberger, for example, will "work hand-in-hand with Asmodee to increase FFG's marketing presence in Germany, such as greatly expanding FFG's visibility at shows like Spiel in Essen". (Asmodee had already enlarged its presence at Spiel 2014 to occupy approximately one-quarter of Hall 3, thanks in part to the Days of Wonder acquisition, so perhaps it'll have one-third in 2015 — or, why not, all of Hall 1?)

Petersen added this note about these publishing companies: "The questions regarding partners like Edge and Heidelberger are actually very pertinent. FFG could not have been the company we are today without the work, support, collaboration, and friendship of people like Harald, Heiko, Gilles, and Jose. It was vital to me that those partners find a positive place and future in the context of this merger. I believe we've achieved this." (My translation: Don't be surprised should Asmodee acquire Edge and Heidelberger in the near future. Again, speculation, but I will point to this line in a January 2014 Reuters article about Eurazeo's acquisition of Asmodee at that time: "The acquisition debt was provided by European Capital and Tikehau, which have also made a dedicated debt facility available to the company to finance its external growth." That said, I put the question to Asmodee and company rep Kevin Brown reported the following answer: "For the foreseeable future, it is anticipated that current and upcoming FFG products will continue to be localized and sold by FFG's existing international partners. Asmodee intends to work with those same distributors to broaden product availability, marketing presence, and organized play support where possible.")

As for China, Petersen wrote, "Only a few of our products are available in Chinese — legally anyway." While FFG will continue to partner with Wargames Club, Game Harbor and Swan Panasia "on those products that make sense for them", wrote Petersen, "Asmodee's China offices will allow significantly more FFG games to be localized and available in China which will be a great thing."

What's more, added Petersen, "other than publishing, Asmodee's China office should allow us to do an even better job in our compliance monitoring of product and workplace safety/ethics of factories, a point that is very important to FFG and its licensing partners, and increasingly to gamers."

Asked for closing thoughts on the deal — why this partner, why now — Petersen wrote: "From time to time over the last twenty years, we have experienced interest from outside parties — some very cursory, and some serious. None have balanced all the considerations as carefully and positively as Asmodee's offer. I believe the merger will be a tremendous positive for our staff, our partners, and most importantly, the players who want to see FFG's brand of game products prosper into the future."
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