Ubisoft carves out its biggest games with a $1.25 billion investment from Tencent
French games maker Ubisoft, which makes major franchises like “Assassin’s Creed,” “Far Cry,” and “Rainbow Six,” is spinning off those titles into a new subsidiary. Taking a 25% minority stake in the carve-out with a $1.25 billion investment is Chinese entertainment giant Tencent.
Ubisoft ADRs in the US, as well as shares in Europe, climbed on the news, which first broke Thursday, before shedding their gains as part of an across-the-board retreat out of stocks Friday morning in the US.
Ubisoft told investors it’s still too early to know how many of its roughly 17,000 employees will join the spin-off, though the franchises under its control have demanded massive resources. Almost 3,000 developers were working on “Assassin’s Creed” alone as of 2023.
It’s been a glitchy few years for Ubisoft, which has struggled with budget bloat, delays, and underperformance for blockbuster games like “Star Wars Outlaws” and “Avatar.”
Investors appear cautious about the move, and the spin-off’s $4.3 billion valuation is significantly higher than Ubisoft’s current market cap. The deal is expected to close by the end of this year.
Ubisoft told investors it’s still too early to know how many of its roughly 17,000 employees will join the spin-off, though the franchises under its control have demanded massive resources. Almost 3,000 developers were working on “Assassin’s Creed” alone as of 2023.
It’s been a glitchy few years for Ubisoft, which has struggled with budget bloat, delays, and underperformance for blockbuster games like “Star Wars Outlaws” and “Avatar.”
Investors appear cautious about the move, and the spin-off’s $4.3 billion valuation is significantly higher than Ubisoft’s current market cap. The deal is expected to close by the end of this year.
