Islamabad, Oct 5: Tencent Set to Acquire Ubisoft in Potential Buyout, Reshaping Gaming Industry
A recent Bloomberg report hints at a potential buyout of video game giant Ubisoft following its recent struggles, including a significant decline in stock value and criticism from both gamers and investors.
Tencent, a Chinese tech company, and the Guillemot family, who founded Ubisoft, are reportedly exploring ways to stabilize the company, possibly by removing it from public stock exchange listings.
These discussions follow increasing shareholder pressure for changes, particularly after disappointing sales of Star Wars Outlaws led to a sharp decline in Ubisoft’s stock value, hitting a ten-year low.
The game’s poor reception contributed to a 54% drop in the company’s share price this year, reducing its market capitalization to $1.5 billion.
Both Tencent and the Guillemot family have started consulting with advisors to assess the feasibility of the buyout, but the discussions are still in the early stages, and a successful deal is not guaranteed.
Guillemot Brothers LTD, the family company, holds 20% of Ubisoft’s voting rights, while Tencent currently owns 9.2% and increased its indirect stake through a 2022 investment in Guillemot Brothers LTD.
This potential buyout follows calls from AJ Investments for Ubisoft to go private, reflecting mounting concern over the company’s future in the wake of continued financial underperformance.
