After resisting Vivendi, could Ubisoft go under the Chinese flag?

Tencent would like to increase its stake in the capital of Ubisoft, with the aim of becoming its main shareholder. A few years ago, the French firm fought to avoid a takeover by Vivendi.

Ubisoft fought like hell in 2018 to avoid a hostile takeover from Vivendi, which then held 27.27% of the capital. In 2022, it is rumored that another shark could engulf the French firm: Tencent. According to information from Reuters published on August 4, the Chinese giant would consider becoming the main shareholder of Ubisoft. Today, he holds 5% of the capital – against 15% for the Guillemot family.

The media relies on four sources to relay this indiscretion. Tencent would obviously be ready to invest up to €100 per share to consolidate its stake, while the current value does not exceed €50 (it is also seeing an increase). In 2018, Tencent had paid €66 per share to enter the capital.

Ubisoft. // Source: Claire Braikeh for Numerama

Tencent soon major shareholder of Ubisoft?

Attention, we are still far from an acquisition of Ubisoft by Tencent, but it is a possible scenario in the more or less long term. The economic situation of the French publisher is far from enviable, with a very complicated year if we look at the calendar of games. Recently, Ubisoft pushed back the release ofAvatar: Frontier of Pandora, once expected by the end of 2022, and canceled no less than four projects. Other expected productions are in hellish development cycles (Beyond Good & Evil 2the remake of Prince of Persia: The Sands of Time). These are not very positive signals and Tencent’s financial maneuvers could make it possible to pocket cash very quickly.

Tencent is very committed to completing the deal as Ubisoft is an important strategic asset for Tencent. “Said a Reuters source. The Asian conglomerate, which has marbles all over the place, particularly within major market players such as Riot Games (League of Legends) or even Epic Games (Fortnite), would see Ubisoft as another foothold in the West — as its sales in China have fallen. Remember that Ubisoft has very strong brands, such as Assassin’s Creed, Ghost Recon and Splinter Cell.

Ubisoft is still playing a dangerous game and taking the risk of finding itself in a situation comparable to the one it wanted to avoid when Vivendi approached. Vincent Bolloré’s group entered through the back door and gradually increased its stake, until it threatened a takeover. Tencent could follow the same strategy, which would kill the philosophy of independence advocated by Ubisoft since its genesis.

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