As the future of Ubisoft looks ever more bleak, it’s said the company is considering going private with the help of Tencent.
Between the delay of Assassin’s Creed Shadows and poor sales of Star Wars Outlaws, it’s clear Ubisoft is knee deep in financial trouble at the moment.
Last month, Ubisoft’s share price dropped to its lowest point in almost 11 years, sparked by the ‘soft’ sales of Star Wars Outlaws. This comes after a string of titles which seemingly failed to hit sales expectations, including XDefiant, Skull And Bones, and Prince Of Persia: The Lost Crown.
The delay of Ubisoft’s biggest game this year, Assassin’s Creed Shadows, to February 2025 appears to have made a bad situation worse, with the owners of the company now apparently considering a buyout.
As reported by Bloomberg, the Guillemot family, which founded Ubisoft and have a 20.5% stake, and Chinese conglomerate Tencent – which has a 9.2% stake in the company – are said to have been speaking with advisers to find ways to stabilise Ubisoft and bolster its value.
One of the options is said to be a potential buyout of Ubisoft between the Guillemot family and Tencent, which would take the company private. It’s claimed these talks are at ‘an early stage’, however, with ‘no certainty they will lead to a transaction’.
Ubisoft stock has dropped 54% over the past year, with minority investor AJ Investments recently publishing an open letter calling for strategic and structural changes at the company.
In the letter published last month, AJ Investments expressed its ‘deep dissatisfaction with the current performance and strategic direction of the company’. It also urged the board to consider taking the company private, and replacing current CEO Yves Guillemot.
Ubisoft and Tencent have not commented on the reports, but it’s unclear how a potential buyout would shape the company moving forward. Tencent has stakes in various gaming companies, and even owns several entirely, including Riot Games and Sumo Group, but it’s difficult to guess whether it would lead to a shift in direction at Ubisoft.
It’s clear the company needs some kind of overhaul though. While it has made some great games in recent years, including Prince Of Persia: The Lost Crown and Mario + Rabbids: Sparks Of Hope, it’s been a while since it had a major hit – with the last big success story being 2020’s Assassin’s Creed Valhalla, which surpassed $1 billion in revenue.
What is Tencent?
Tencent is a Chinese technology conglomerate which is one of the biggest multimedia companies in the world and the biggest video games publisher. While it has investments in other areas of entertainment and technology, it’s primarily known for its investments in the games industry.
Along with publishing games under its own Tencent Games division, like Call Of Duty: Mobile and Pokemon Unite, it also owns games companies like Riot Games, Funcom, and Sumo Group, and has stakes in other developers like Tequila Works, Ubisoft, and FromSoftware.
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