Ubisoft is countering its financial difficulties by spinning off three top brands into a new subsidiary. Tencent is taking a 25 percent stake worth more than a billion euros.
Assassin’s Creed should save Ubisoft with the latest offshoot Shadows through sales – now the game series could do it in a different way. The action-adventure as well as the two other top brands Far Cry and Tom Clancy’s Rainbow Six are being transferred to a subsidiary. Ubisoft announced this in a press release late Thursday evening.
Little is known about the new company yet – except for one shareholder. Games giant Tencent, which is also a major shareholder in Ubisoft, is investing 1.16 billion euros in the company. In return, the Chinese company will receive 25 percent, which raises the total valuation of the Ubisoft-Tencent company to more than four billion euros.
It’s quite curious: Ubisoft itself, including all brands and development studios, is currently valued at around 1.8 billion euros on the stock exchange – not even half of the new company. The new company will be granted a “worldwide, exclusive, irrevocable and perpetual license” for the three top brands mentioned.
“A new chapter” in Ubisoft’s history
“Today, Ubisoft is opening a new chapter in its history,” says Yves Guillemot, co-founder and CEO. “As we accelerate the company’s transformation, this is a fundamental step in changing Ubisoft’s operating model, which will enable us to be both agile and ambitious.”
According to him, the measure strengthens “the financial balance sheet” and “creates the best conditions for the long-term growth and success of these franchises”. For Tencent President Martin Lau, the investment “reflects continued confidence in Ubisoft’s creative vision and extraordinary talent”.
Questions upon questions – answers soon?
But what does this change at the French video game company mean for the employees? It is not yet clear how many of them will transfer to the new company. Nor are the possible consequences for the majority of Ubisoft, who are not involved in Assassin’s Creed & Co., reliably foreseeable. This also affects more than 800 employees in Germany.
According to GamesWirtschaft, Ubisoft manager Marie-Sophie de Waubert de Genlis tried to make it clear via e-mail shortly after the press release that employees who do not work on the outsourced top brands are no less important and valued within the company. The deal with Tencent is beneficial for everyone.
The many open questions could be at least partially clarified on Friday afternoon: Ubisoft CEO Guillemot is scheduled to comment on the background and impact of the gaming hammer in a livestream starting at 3:30 p.m.
