Ubisoft Entertainment SA, the French video game giant behind blockbuster franchises like Assassin’s Creed, Far Cry, and Just Dance, is reportedly exploring a buyout to restructure the company without diminishing the control of its founding Guillemot family. Discussions are ongoing with Chinese gaming powerhouse Tencent and other potential investors to fund a management-led buyout, sources familiar with the matter told Reuters.
The Guillemot family, Ubisoft’s largest shareholder, is determined to retain its current level of influence as part of any potential deal. With 15% ownership of Ubisoft and 20.5% of voting rights, the family seeks to steer the company through challenging times while safeguarding its legacy.
Tencent’s Calculated Approach
Tencent, which owns nearly 10% of Ubisoft, has been a key stakeholder in these talks. The Chinese tech giant is interested in preventing hostile takeovers by other investors and deepening its partnership with Ubisoft. However, Tencent’s participation hinges on securing greater influence in future board decisions, particularly concerning cash flow management—terms that are yet to be agreed upon.
Insiders suggest that Tencent is adopting a patient strategy, willing to wait for the Guillemot family to agree on terms. At the same time, Tencent may opt to maintain its current stake, viewing its position as sufficient for sustaining its gaming collaborations with Ubisoft.
Market Reaction and Shareholder Pressure
News of the buyout discussions has already sent ripples through the market. Ubisoft’s shares jumped by as much as 16% following the Reuters report, trading 12.1% higher at €13.2 by mid-afternoon GMT.
This surge in value comes as minority shareholders, including AJ Investments, have been vocal in urging a strategic overhaul. These stakeholders have called for either a privatization of Ubisoft or its sale to a larger industry player, citing the company’s declining stock performance.
Challenges Mount for Ubisoft
The buyout discussions come amid a turbulent period for Ubisoft. The company’s stock plummeted to a decade-low in September following disappointing sales and the delayed launch of Assassin’s Creed Shadows. Earlier this week, Ubisoft announced it would discontinue development of its multiplayer game XDefiant, closing production studios in San Francisco and Osaka while scaling back operations in Sydney.
Such moves reflect the company’s struggle to align its development pipeline with market expectations. As it revises its strategies, Ubisoft has reiterated its commitment to exploring all strategic options in the interest of its stakeholders.
Future at a Crossroads
The Guillemot family’s vision for Ubisoft aligns with a broader trend of founders seeking to reclaim or consolidate control over their companies during periods of financial and operational volatility. However, balancing this objective with the expectations of influential investors like Tencent and the concerns of minority shareholders will require careful negotiation.
As these talks unfold, Ubisoft’s future direction remains uncertain. The outcome of these discussions could reshape the landscape of the global gaming industry, potentially positioning Ubisoft for a new phase of growth—or further challenges.
For now, the gaming world watches closely, as the iconic studio behind some of the industry’s most beloved franchises navigates this pivotal moment in its storied history.
