Will Ubisoft fly the Chinese flag faster than we think? At least that’s what an indiscretion on the part of the press agency suggests to us. Reuterswhich indicates that discussions between the French publisher and Tencent are much more advanced than we think. Two corroborating sources close to the matter have in fact indicated that the Guillemot family has been in talks for several weeks with the Chinese video game giant, but also other investors, in order to finance a takeover of Ubisoft, with this idea of exiting the stock market business. According to Reuters sources who wish to remain anonymous, the Guillemot family has indicated that it wants to retain control of the company.
Tencent, which is currently Ubisoft’s second largest shareholder, has not yet commented on the takeover or even the increase in its stake in the company. This is partly because Tencent has asked to have more say in future board decisions, including the distribution of cash flows in exchange for financing the deal, which does not was not agreed with the Guillemot family. Discussions between the two parties are ongoing as Tencent also wants to prevent any potential hostile takeover of Ubisoft by other investors, clarifying that Tencent’s plan is to be patient and wait for the Guillemots to agree to a deal. Tencent may choose not to increase its stake in Ubisoft, as it considers its current direct stake of almost 10% in Ubisoft to be sufficient to maintain its business cooperation with the company in the gaming field.
Contacted by Reuters, Tencent refused to comment on the situation, just like Ubisoft, where it continues not to respond to its rumors which are however becoming very insistent and more and more precise. “We remain committed to making decisions in the best interests of all our stakeholders”said a Ubisoft spokesperson. “In this context, as we have already indicated, the company is also examining all its strategic options.” In October, Ubisoft said it was regularly reviewing “all of its strategic options” but declined to comment further on a report of buyout interest.
Ubisoft shares rose 16% after the Reuters article was published. Its shares were trading up 12.1% at 13.2 euros at 2:45 p.m. GMT. The buyout discussions come as some minority shareholders, including AJ Investments, are pushing for an exit from the stock exchange or a sale of Ubisoft to a strategic investor amid the falling share price, Reuters previously reported . The company’s shares fell to their lowest level in a decade in September after it cut its guidance due to weaker-than-expected sales and postponed the launch of the title “Assassin’s Creed Shadows.”
We also learned a few days ago that the XDefiant game was being discontinued and, consequently, would be closing its production studios in San Francisco and Osaka, as well as scaling back at Ubisoft Sydney. Ubisoft is run by the Guillemot family, which owns 15% of the company, followed by Tencent which owns just under 10%, according to LSEG data. The family held about 20.5% of Ubisoft’s net voting rights while Tencent held 9.2% as of the end of April, according to the company’s latest annual report.