[Flash note] - ASMDEE: Acquires the IP of Zombicide, Here is What We Know

Zombicide, Deal Rationale

We have not presented a full research report on Asmodee (ASMDEE-B), but we still keep it on our Discovery list as a potential case for the future. Therefore, we will occasionally comment on news related to the company. The IP was owned by the Honkong Kong-listed company CMON.

Acquiring Zombicide

This morning ASMDEE-B announced the acquisition of Zombicide. The IP encompasses multiple game lines and thematic variations, creating a comprehensive ecosystem of products.

Some Numbers

The Zombicide franchise has sold over 2 million copies globally since its inception, establishing it as a cornerstone property in the cooperative board gaming segment. The brand’s commercial success began with its groundbreaking Kickstarter campaign in 2012, which raised $800k from +5,00 backers, pioneering the use of crowdfunding in tabletop gaming.

The franchise’s crowdfunding success has been consistently strong across multiple iterations. Zombicide campaigns have collectively raised over $50 million through various crowdfunding platforms, with individual campaigns achieving remarkable funding levels. The Marvel Zombies campaign alone raised over $9 million in 2022, demonstrating the brand’s ability to leverage popular intellectual properties for enhanced commercial performance. We have not been able to find exact sales numbers for the Zombicide IP.

CMON’s Financial Challenges Likely Created a Favorable Price

The acquisition comes at a strategic time when CMON has faced significant financial pressures. CMON reported losses exceeding $3 million in 2024, representing almost double its combined profits from the previous three years. The company’s revenue declined from $45.1 million in 2023 to $37.4 million in 2024, primarily due to reduced performance in crowdfunding campaigns.
CMON’s financial difficulties included rising operational costs, declining crowdfunding revenues, and challenges related to US tariff policies affecting manufacturing costs. The company has been forced to implement cost-reduction measures, including staff layoffs and halting new game development initiatives. All this combined with a rather significant debt load.

These circumstances created an opportunity for Asmodee to acquire a valuable intellectual property at a potentially favorable valuation.

The Bigger Picture

ASMDEE-B has been able to acquire a strong IP, likely at a reasonable to low price, which we favor. What we think is even more critical is the signaling value of this as the first acquisition after the spin-off from EMBRAC-B. As one of the core pillars of the spinoff, the goal was to create an environment where ASMDEE-B could continue its successful acquisition strategy, which it had previously employed before joining the Embracer Group.

Scale and Brands, the moats at play

When we look at ASMDEE-B, we find that there are two moats at play—mainly “Brand” and “Scale” advantages.

Brand is relatively self-explanatory, customers get attached to certain brands when it comes to games, and they buy new installments of the franchise, and will not play a “copycat. This leads to long-term pricing power and revenue stability. By focusing on strong brands like Zombicide they can acquire and expand their portfolio, thus broadening this moat.

Scale is what truly shines as the Group has cultivated a dominant position in the global board game market through structural scale advantages that create barriers to entry for competitors while amplifying profitability. We believe that the company’s scale moat is evident across its distribution network and the scale advantages of its R&D.

Asmodee operates the most extensive distribution infrastructure in the tabletop gaming industry, spanning 130+ countries with direct operations in 22 key markets. This network enables:

• Cost efficiencies: Centralized logistics reduce per-unit shipping and warehousing costs.

• Retailer leverage: Asmodee’s 21+ year partnerships with major retailers like Walmart and Amazon provide preferential shelf placement and promotional support.

• Channel specialization: Tailored strategies for hobby stores versus mass retailers ensure optimized inventory turnover.

• R&D scale: Operational leverage on large R&D budgets thanks to a large revenue base.

• Transmedia potential: Flagship IPs like CATAN have spawned digital adaptations and merchandise, creating revenue streams beyond physical sales and giving competitors a disadvantage.

With 20+ acquisition targets in advanced talks, scalability remains the core driver of shareholder value for ASMDEE-B.

Strong Share Performance, but Steady Multiple Valuation

After the post-spinoff dip, ASMDEE-B has shown a strong performance, increasing by over 50%. It’s very likely that the initial decline was just an effect of what happens at a spinoff, where some investors were there for the parent company and some funds has to reallocate their exposure as the newly spun-off company does not fit their initial allocation.

Interestingly, despite the significant increase in share price, the EV/EBIT ratio based on the NTM has remained steady and currently stands at 16.7x.

Market expectations

Our own estimates that materially deviate from market expectations. Given that, we view the current price as relatively fair, but we continue to monitor the company for a potential opportunity in the future.