Ubisoft Shares Surge 31% As Tencent And Guillemot Family Reportedly Mull Buyout
by Ty Roush · ForbesTopline
Tencent Holdings is considering a possible buyout of Ubisoft Entertainment with the Guillemot family, which founded the French video game publisher, Bloomberg reported Friday, sending Ubisoft’s stock soaring after falling to a decade-low.
Key Facts
Ubisoft’s shares increased by more than 31% to just over €14 (about $15.35) as of around 11:40 a.m. Friday.
Tencent and Guillemot Brothers—a holding company run by members of Ubisoft’s founding family—have held discussions about acquiring Ubisoft, though those considerations are at an early stage, people familiar with the matter told Bloomberg.
Both companies are considering taking Ubisoft private if a transaction does go through, the people said.
Tencent—which purchased nearly 50% of Guillemot Brothers in 2022—holds 9.2% of Ubisoft’s net voting rights, or power in voting by shareholders, while the Guillemot family has about 20.5%, according to Ubisoft’s latest annual report.
Ubisoft did not immediately respond to a request for comment from Forbes.
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Surprising Fact
Ubisoft’s shares decreased to an intraday low of €9.76 ($10.70) on Sept. 26, the farthest the stock had fallen since November 2013, when shares traded as low as €9.15. The plunge followed Ubisoft cutting its guidance for its upcoming fiscal year while projecting sales of $2.2 billion, lower than analyst estimates of about $2.6 billion, according to FactSet. Ubisoft also delayed the launch of “Assassin’s Creed Shadows” from Nov. 15 to February 2025, citing a requirement to “polish and refine the experience” of the game.
Key Background
Speculations of an Ubisoft takeover have swirled in recent years amid scrutiny from its shareholders. AJ Investments, an activist investment firm, wrote a letter to Ubisoft last month saying the firm had the support of 10% of Ubisoft’s shareholders while calling on the French video game publisher to sell to Tencent and the Guillemot family, citing a “deep dissatisfaction.” AJ Investments also claimed it had “industry experts” to replace Ubisoft’s management, a move the company said would lead to a turnaround at Ubisoft. Other private equity firms have considered buying out Ubisoft, including Blackstone and KKR & Co., both of which reportedly held discussions in 2022.