The summer rumors were true. As reported by Reuters in early August, the French video game giant Ubisoft has opened the capital of its controlling holding, Guillemot Brothers, to the Chinese group Tencent. But there is no question of changing the management of this big gaming player.
This investment, which amounts to 300 million euros, actually remains a minority (49.9%). “Tencent will not be represented on the board and will have no approval or operational veto power.“, Ubisoft’s press release emphasizes. The Guillemot brothers are therefore still at the helm of the company they founded in the 1980s.
However, the agreement signed between the Guillemot family and Tencent gives the latter the right to increase its direct stake in Ubisoft. The Chinese group, which entered the capital of the French company when Vivendi left it in 2018, took 4.5%. Now it can go up to 9.99%. But Ubisoft’s management has added binding clauses.
This maximum rate of 9.99 percent will be frozen for eight years. And those shares cannot be resold for 5 years, the Guillemot family has priority to buy them back.
Protect yourself from hostile action
“This deal is in line with our philosophy of investing alongside creative founders, with full confidence that they will take their businesses to new heights. comments Martin Lau, President of Tencent. The world’s leading Chinese group of video games belongs to the American company Riot Games (League of Legends) and mobile gaming giant Supercell (Clash Royale). But it has also taken minority stakes in a number of Western video game players.
This strengthened partnership is announced at a time when the video game industry is fully consolidated. The Activision-Blizzard giant is set to gobble up Microsoft, and EA is said to have held discussions with Amazon. Sony acquired several development studios, while France’s Quantic Dream was acquired by Chinese group NetEase.
Ubisoft, with its rich catalog of licenses and market value of €5.5 billion, was also seen as an attractive target to take over. This agreement with Tencent allows it to protect itself from hostile takeovers. Strengthened by its Chinese ally, the holding now owns 24.5% of the voting rights and 19.8% of the capital.
Source: Le Figaro
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.