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Ubisoft shareholders in talks over possible buyout terms, sources say
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Ubisoft shareholders in talks over possible buyout terms, sources say
Dec 6, 2024 6:21 AM

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Guillemot family seen wanting to retain control in buyout

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Tencent ( TCTZF ) undecided on increasing stake

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Minority shareholders push for sale amid stock decline

By Amy-Jo Crowley and Julie Zhu

LONDON/HONG KONG, Dec 6 (Reuters) - Shareholders of

Ubisoft Entertainment SA are considering how to

structure a possible buyout of the Assassin's Creed video game

maker without reducing the founding family's control, two people

familiar with the matter told Reuters.

The Guillemot family, which is the largest and founding

shareholder, has been in talks with Tencent ( TCTZF ) and other

investors in recent weeks about funding a management-led buyout

of France's largest video games maker, the people said, speaking

on condition of anonymity.

However, the Guillemot family has indicated it would like to

retain the control it has over the company, which also makes

Just Dance, Far Cry and Tom Clancy's video game series, as part

of a deal, the people said.

Tencent ( TCTZF ), currently the second-largest shareholder in Ubisoft

and China's biggest social network and gaming firm, has yet to

decide whether to participate in the buyout and increase its

stake in the company, one of the people said.

This is partly because it has asked for a greater say on

future board decisions including cash flow distribution in

return for financing the deal, which has not been agreed upon

with the Guillemot family, the person added.

Discussions between the two parties are ongoing as Tencent ( TCTZF )

also wants to prevent any potential hostile takeover of Ubisoft

by other investors, said the person, adding that Tencent's ( TCTZF ) plan

is to remain patient and wait for the founding family to agree

to a deal.

Tencent ( TCTZF ) may opt not to increase its stake in Ubisoft, as it

considers its current direct holding of almost 10% in Ubisoft

sufficient for maintaining its gaming business cooperation with

the company, the person added.

Tencent ( TCTZF ) declined to comment. A representative of the

Guillemot family did not respond to requests for comment.

"We remain committed to making decisions in the best

interests of all of our stakeholders" a spokesman for Ubisoft

said. "In this context, as we have already indicated, the

Company is also reviewing all its strategic options."

In October, Ubisoft said it regularly reviewed "all its

strategic options", but declined further comment on a report of

buyout interest.

The buyout talks come as some minority shareholders

including AJ Investments have been pushing for either a

take-private or a sale of Ubisoft to a strategic investor amid

the stock price plunge, Reuters previously reported.

The company's shares fell to their lowest level in the last

decade in September after it cut its outlook on

weaker-than-expected sales and postponed the launch of

"Assassin's Creed Shadows" title.

This week it announced it would discontinue development of

its gaming title XDefiant and as a consequence close its

production studios in San Francisco and Osaka, and ramp down

production in Sydney.

Ubisoft is run by the Guillemot family, which owns 15% of

the firm, followed by Tencent ( TCTZF ) which owns just under 10%,

according to LSEG data.

The family held about 20.5% of Ubisoft's net voting rights

while Tencent ( TCTZF ) owned 9.2% as of the end of April, as per the

firm's latest annual report.

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