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In a significant development for the gaming industry, a report by Bloomberg suggests that French video game giant Ubisoft may soon be the target of a major buyout by Chinese tech titan Tencent. This news comes amid growing concerns over Ubisoft’s recent performance, which has resulted in sharp declines in its stock value and mounting pressure from shareholders for substantial changes.
The report indicates that Ubisoft, known for iconic franchises such as Assassin’s Creed, Far Cry, and Just Dance, has faced criticism from both gamers and investors over the past year. In light of this, the Guillemot family—founders of Ubisoft—and Tencent are reportedly in early discussions on the possibility of acquiring the company and taking it private, in hopes of stabilizing its financial position.
According to sources close to the matter, Tencent and the Guillemot family are working with financial advisors to explore the feasibility of the buyout. While discussions are still in their preliminary stages, the potential acquisition would mark a pivotal moment in the gaming industry. However, no final decisions have been made, and the possibility of the deal falling through remains.
The push for a buyout follows Ubisoft’s significant decline in market capitalization, which now stands at $1.5 billion. Shares have dropped by 54% this year, marking the company’s lowest point in a decade. The release of Star Wars Outlaws, which was expected to bolster Ubisoft’s fortunes, instead contributed to the decline, as sales fell short of expectations. This led to a dramatic drop in Ubisoft’s stock price and disappointment from both investors and developers.
The Guillemot family, which currently holds 20% of Ubisoft’s voting rights through its investment vehicle, Guillemot Brothers LTD, is exploring the possibility of partnering with Tencent to remove the company from public stock exchange listings. Tencent, which already holds a 9.2% stake in Ubisoft, further increased its influence in 2022 by acquiring a stake in Guillemot Brothers LTD.
A potential buyout could allow Ubisoft to focus on long-term growth away from the pressures of public markets, and it would enable Tencent to expand its influence in the Western gaming world, adding another major name to its growing portfolio.
As talks progress, the gaming community and investors alike are closely watching how this potential acquisition could reshape the future of Ubisoft, its beloved franchises, and its position within the global gaming market.
