Ubisoft Reportedly Working On Buyout Plans, Currently Looking For Deal That Would Allow Guillemot Family To Stay In Control Of ‘Assassin’s Creed’ Studio
After it was previously revealed that Ubisoft was entertaining the idea of buying out their outstanding stock shares and taking the company private, a new report has confirmed that not only is the Assassin’s Creed studio actively working towards this goal, but they’re attempting to do so in a way that will allow its founders, the Guillemot family, to retain control of its operations.
This latest update on the French developer’s ongoing implosion was first brought to light by Reuters reporters Amy-Jo Crowley and Julie Zhu, who purportedly learned of the buyout’s current status from “two people familiar with the matter”.
According to said insiders, Ubisoft, as well as their minority shareholder Chinese developer Tencent (who currently own 10% of the company) and various other investors “about funding a management-led buyout”.
For those unfamiliar with the deeper intricacies of corporate finance and business terminology, a Management Buyout entails a company’s leadership, with the possible financial assistance of other major investors, buying out all the publicly outstanding shares of a given entity in order to take the company private and assert more direct control of its future direction.
While Crowley and Zhu’s sources did not provide any details as to the specific discussions occurring in Ubisoft’s upper levels, they did note that “the Guillemot family has indicated it would like to retain the control it has over the company”.
(In other words, should a buyout actually occur, it’s unlikely to effect change in the developer’s creative or managerial philosophies.)
As for Tencent, the pair of reporters were informed that the company is currently unsure of whether or not it will actually participate in the buyout, their decision resting on whether or not Ubisoft will honor their request to have “a greater say on future board decisions including cash flow distribution”.
However, despite this ‘slow and steady’ strategy, the China-based gaming giant has supposedly expressed concern that should they decline to fund Ubisoft’s privatization efforts, any number of other companies could perform a “hostile takeover” of the Far Cry studio by putting up the money in exchange for becoming a majority shareholder.
Ultimately, how these factors will play into Tencent’s decision remains to be seen, with the company currently choosing to “remain patient and wait for the founding family to agree to a deal.”
When reached for comment, both Tencent and a representative for the Guillemot family declined to speak on the matter.
Meanwhile, a spokesperson for Ubisoft informed the news wire, “We remain committed to making decisions in the best interests of all of our stakeholders. In this context, as we have already indicated, the Company is also reviewing all its strategic options.”
Word of Ubisoft’s potential interest in going private was first revealed on October 4th courtesy of Bloomberg’s Vinicy Chan, Dong Cao, and Benoit Berthelot.
Relaying information learned from their own respective insiders, the trio reported that following an string of absolute commercial and PR disasters that led to the company losing roughly half of its market value, the Guillemot brothers and Tencent had begun “speaking with advisers to help explore ways to stabilize Ubisoft and bolster its value,” with “one of the possibilities being discussed [involving the two entities] teaming up to take the company private”.
More About:Video Game News
Read This Next
