Tencent and Guillemot Family Explore Potential Buyout of Ubisoft

Prospective Buyout Talks

Tencent Holdings, together with Ubisoft's founding Guillemot family, is considering a strategic buyout of the gaming studio. Following a massive depreciation in Ubisoft's market value this year, estimations suggest that the talks aim to stabilize the organization while enhancing its value. Reports indicate that Tencent currently possesses 9.2% of Ubisoft's net voting rights, while the Guillemot family retains approximately 20.5%.

Market Reactions

After the news broke, Ubisoft’s shares surged by 33% in Paris, marking the most significant jump since the company's IPO. Investors are watching closely as potential changes loom over the gaming giant.

Strategic Considerations

• Discussions are in preliminary phases with no guarantees of a finalized transaction.
• Some minority shareholders are advocating for a take-private strategy or sale to a strategic investor.
• Reports indicate that other alternatives are being weighed by both Tencent and the Guillemot family.

Recent Struggles

This year, Ubisoft faced a staggering 40% drop in shares, attributed to weaker sales and delays in major game releases. The recent market fluctuations have prompted action from major stakeholders to secure a more stable future for the studio.

Background

In recent years, Ubisoft has grappled with significant production challenges leading to canceled titles and continuous delays. As gaming demands evolve, the company's capacity to adapt has come under scrutiny by analysts.