- Several Ubisoft games underperformed, causing the company to lose over half its market value
- Speculation surrounds a possible reshuffle following a buyout, with rumors of a potential 30-40% workforce reduction
- Following the news, Ubisoft shares rose by up to 33% in Paris
In what seems to be a major move in the gaming industry, Chinese gaming giant Tencent and the founding Guillemot family of Ubisoft are considering a potential buyout of the French game developer. According to reports, people familiar with the situation said that this conversation happened after Ubisoft’s market value dropped by over half this year.
One of the options currently being discussed is to take Ubisoft private or a sale to an investor
On Friday, Bloomberg reported that Tencent is “weighing” the acquisition move, which immediately triggered discussions and concerns within the gaming community. Several of Ubisoft’s games have underperformed in sales this year, contributing to the company losing more than half of its market value.
Many speculate a reshuffle within the company in case of a buyout, with rumors of a potential 30-40% workforce reduction already circulating. Ubisoft most recently in August laid off staff from its US office.
What fueled these discussions more was how Ubisoft’s Monetization Director Stevy Chessard voiced concerns about the backlash from gamers, pointing out how social media has become a place where people openly wish harm to companies and employees.
Stating that the gaming industry is going through a rough period, he emphasized that seeing this level of hate especially from within the industry was both hurtful and shameful. This did not sit down well with many gamers who reacted negatively to this “gamer-blaming” statement.
Following the breakout of the news, Ubisoft also saw a positive rise in the market, with the shares having gained up to 33% in Paris. This number is its highest gain since the company went public in 1996. Currently, the Guillemot family holds a 14% stake in Ubisoft, whereas Tencent holds a 9.99% stake.
Ubisoft acknowledges buyout reports, states it ‘reviews all its strategic options’
Ubisoft has responded to recent reports about a potential buyout with Tencent, stating that it “regularly reviews all its strategic options”. Sharing a statement regarding this report with Eurogamer, Ubisoft responded that it “regularly reviews all its strategic options in the interest of its stakeholders and will inform the market if and when appropriate.”
The company emphasized that these discussions are speculative and no decisions have been made yet. Currently, Ubisoft puts its focus on two key areas: open-world adventures and GaaS-native experiences while continuing to evaluate its options.
The possibility of a Tencent acquisition marks a critical moment for Ubisoft, surely. One of the options currently being discussed is taking the French video game maker private or a sale to a strategic investor. For now, these are just rumours, nothing’s official yet. We need to wait and see what will happen next, as this could represent a major shift in the gaming industry.
Keep an eye on this space, as I’ll be sharing more updates on the same as it arrives. Until then, read other related articles:
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