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Ubisoft could go under Chinese or Saudi ownership in 2025

by admin January 17, 2025
January 17, 2025
Ubisoft could go under Chinese or Saudi ownership in 2025

Ubisoft Entertainment has delayed the launch of its much-anticipated title “Assassin’s Creed Shadows” and has “appointed advisors to review strategic options to extract the best value for stakeholders.”

While the video game maker is yet to offer more colour on its exact plans – the aforementioned developments are being broadly construed as signs of the management’s interest in a full or partial sale of the company.

According to Michael Pachter, a senior analyst at Wedbush Securities, China-based Tencent is among potential suitors who stand to gain the most from buying Ubisoft.

Shares of the French company are down more than 10% for the year at the time of writing.

Tencent has already shown interest in Ubisoft

There have already been reports that Tencent has teamed up with Guillemot Brothers to take Ubisoft private.

Guillemot Brothers currently has the largest stake in the game maker.

In fact, the two entities reportedly plan on setting up a new venture that would include a bunch of Ubisoft assets.

The new venture could be Tencent’s way of winning more control over the video game company’s intellectual property.  

Michael Pachter sees Tencent as a potential buyer also because Ubisoft has a rather inflated cost base that makes it unattractive for the majority of Western buyers.

“That leaves foreign buyers who have strategic interest,” he told clients in a research note today.

Why is Tencent a suitable buyer of Ubisoft

James Batchelor – the former editor-in-chief of GamesIndustry.biz dubbed Microsoft a suitable buyer but said its previous contest with transatlantic regulators over its $69 billion takeover of Activision Blizzard would make it decide otherwise.

Tencent, on the other hand, has ample reasons to go after Ubisoft. The potential acquisition, for example, feeds right into the Chinese firm’s commitment to expanding its footprint internationally, he argued in an interview with CNBC on Wednesday.  

With limits on how it can grow in its domestic market of China, Tencent has been investing in more and more studios in the West.

In 2021, Tencent spent $1.26 billion on buying a UK-based video game company – Sumo Group.

Savvy Games could buy Ubisoft in 2025

Another potential buyer that could take over Ubisoft this year is Savvy Games Group – a gaming and e-sports company that’s currently under the ownership of the sovereign wealth fund of Saudi Arabia.

“The vision is to create jobs in Saudi Arabia, so as Ubisoft experiences attrition, it can replace lost jobs by hiring there,” Pachter added in the CNBC interview.

There were reports in October that Ubisoft would consider cutting 8,000 jobs to lower its global headcount by about 40%.

Savvy Games was set up in 2021 as part of the Kingdom’s broader push to become a global gaming hub.

Crown Prince Mohammed bin Salman is currently the chairman of this gaming company.

The post Ubisoft could go under Chinese or Saudi ownership in 2025 appeared first on Invezz

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