Private equity firms could start circling Ubisoft, Bloomberg reported Friday. The talks are early but include interest from the likes of Blackstone Inc. and KKR & Co. albeit non-private equity, senior current and former Ubisoft developers my box has spoken to for the past few months, believing that the company will eventually sell to someone amid a declining share price and ongoing production struggles.
Bloomberg reports that Blackstone and KKR & Co., the world’s two largest private equity firms, have “studied the French business” and have “tentative takeover interests” in Ubisoft, but that the company has “not yet entered into serious negotiations with it.” potential buyers.”
Corresponding my boxAccording to Ubisoft’s sources, Ubisoft has been working closely with several outside consulting firms over the past few years to audit various parts of its business. While companies will do this to become more profitable and prepare for the future, sources my box spoke to suggest that this is a sign that Ubisoft is trying to clean up its books for a possible sale.
On a wave of recent major gaming acquisitions, including Grand Theft Auto Publisher Take Two Buy ZyngaSony Buy Bungiand Microsoft’s $69 billion deal to absorb Activision Blizzard, it seems like a game of eat or be eaten for those who stay. EA CEO Andrew Wilson said so in a earnings conference call earlier this year, in which he firmly placed the FIFA publisher in the “big fish that eat other fish” camp.
Ubisoft has been more reticent about its survival strategy. When asked on his recent conference call why the French publisher didn’t appear to have received any offer interest, CFO Frédérick Duguet said he would not speculate as to why no offer had been made until corrected by CEO and co-founder Yves Guillemot. The company, Guillemot claimed, was neither confirmed nor denied “If” potential buyers had approached it.
If someone wanted to buy Ubisoft, they could potentially get it at a huge discount. The stock cost over $110 share in July 2018. Now it’s on $41. But they would still have to go through the Guillemot family, which currently owns an estimated 15% of the nearly $5 billion market cap business.
CEO Yves Guillemot famous fended off a hostile takeover attempt by French media conglomerate Vivendi after it secured funding from Tencent and others in 2018. However, some current and former sources with the company believe the 35-year video game industry veteran may be looking for an exit strategy.
They point to the Departure of his son Charlie Guillemot last year This left no relatives to take over the family business. Ubisoft was also hit by one sustained wave of attrition among his top talents. It continues to struggle with the consequences of a Accounting for Sexual Misconduct in the Workplace that started in the summer of 2020. And some of its biggest projects continue to face upheaval, delays, or are stuck in development hell.
When Bloomberg reported in FebruaryUbisoft decided to shut down one of them Assassin’s Creed Valhallas planned DLCs instead into a standalone stopgap game to fill holes in the release calendar over the next 18 months. In the meantime the next Far cry, Ghost Reconand wholesome Assassin’s Creed Games remain further away than Ubisoft previously planned, according to three sources familiar with their development.
When asked for comment, a Ubisoft spokesman sent my box the following statement:
We do not comment on rumors or speculation. Ubisoft has unmatched creative and production capabilities with more than 20,000 talented people collaborating on game development in our global studios. Thanks to them and our long-term approach and willingness to take creative risks, we have built some of the strongest own brands in the industry and have many promising new brands and projects on the horizon. We also have one of the broadest and most diversified portfolios in the industry, cutting-edge services and technology, and a large and growing community of committed stakeholders. As a result, we are ideally positioned to take advantage of the rapid industry growth and platform opportunities that are emerging.
Correction: 4/23/22, 1:51 PM: An earlier version of this post referenced the wrong Ubisoft stock ticker.
