Ubisoft, one of the world’s video game giants with its roots in France, has been going through a tumultuous period for several years due to various internal and external problems. But the rumors of recent weeks suggest a very important change for the group since we are talking here about a buyout.
The slow decline of Ubisoft over the years
Ubisoft has had a difficult, even very difficult, few years recently. With its stock price having lost six times its value since 2021 and the recent poor sales of Star Wars Outlaws, we can say that it’s a bit of a crisis.
In 2020, Ubisoft was rocked by revelations of sexual harassment, abuse of power, and workplace toxicity. Several senior executives, including Serge Hascoët (creative director) and other high-level figures, were forced to resign. These cases tarnished the company’s reputation and highlighted a problematic corporate culture. Even today, some believe that the systemic problems have not yet been resolved.
Ubisoft has also been criticized for its lack of innovation, with many licenses (Assassin’s Creed, Far Cry or Tom Clancy’s) accused of becoming repetitive. Several major projects, like Beyond Good & Evil 2 and Skull & Bones, have experienced significant delays, creating frustration and loss of confidence.
In 2023, Ubisoft canceled several games in development and reorganized its priorities, which reinforced the idea of an internal crisis. In addition to all this, Ubisoft has tried to diversify its economic model by focusing on free-to-play games and NFTs via the Quartz platform. Initiatives which encountered strong opposition from players, who saw it as a mercantile attempt disconnected from their expectations.
The company’s perception among players has suffered, between disappointments linked to the quality of the games, over-exploitation of its flagship licenses, and unpopular initiatives such as microtransactions or NFTs. Today, the Ubisoft share price is trading around €13 compared to €100 at its peak in 2018.
A buyout currently being negotiated
Ubisoft is in a delicate situation today, both financially, culturally and creatively. The company must absolutely regain the trust of its employees, its players and its investors to regain its leading position in the video game industry, even if the consolidation of the sector further complicates the task.
Today, we learn from Reuters sources that Ubisoft shareholders are currently considering how to structure a possible buyout of the company without reducing the founding family’s control.
According to two people familiar with the matter, the Guillemot family, which is the main shareholder and founder, has been in talks with Tencent and other investors for several weeks to finance a buyout.
The Guillemot family has reportedly indicated that it wishes to retain control of the company. Tencent, which is currently Ubisoft’s second-largest shareholder and China’s largest social network and gaming company, has yet to decide whether it will participate in the buyout and increase its stake in the company, one of the people said. Discussions between the two parties continue as Tencent also wants to prevent a possible hostile takeover of Ubisoft by other investors, the person said, adding that Tencent’s plan is to remain patient and wait for the founding family accepts an agreement.
The rumor of a takeover of Ubisoft by Tencent has already been around since October and at the time, Ubisoft declared “regularly review all its strategic options in the interest of stakeholders and will inform the market if and when this proves necessary. » A buyout seems almost inevitable, but the question is when. In any case, this new information seems to satisfy the markets since the Ubisoft share price rose 12% today to settle at around €13.26.
