Chinese media giants Tencent have invested €300m (£260m) in a company run by Ubisoft’s founding family, the Guillemots. The deal will see Tencent bring some of Ubisoft’s most popular game series to mobile devices and PCs in China. Next comes Tencent’s investment in Guillemot Brothers Limited speculation Last month they were going to get a bigger stake in Ubisoft and even become the largest shareholder.
Ubisoft CEO Yves Guillemot said Tencent’s investment would provide “stability essential to its long-term development.” Along with €300 million, consisting of €200 million in shares and a €100 million capital increase, Tencent is providing Ubisoft with a long-term unsecured loan to refinance its debt. The Chinese company also provides “additional financial resources that can be used to acquire a stake” in French publishing houses.
The agreement between Guillemot Brothers and Tencent is described as a “joint collaboration” between the companies. Although they are investing heavily in Guillemot Brothers, Tencent will not hold positions on the company’s board of directors. They will also have no consent or veto power over what Guillemot Brothers does, and no operational rights over Ubisoft.
Tencent now owns a 49.9% stake in Guillemot Brothers, and this expanded gig means the Guillemots could increase their stake in Ubisoft to 29.9% of equity or voting rights. Ubisoft’s board of directors has allowed Tencent to nearly double its direct stake to 9.99%, with the Tencent block selling its shares over five years. Tencent will not be allowed to increase its stake in Ubisoft for another eight years.
The partnership between Ubisoft and Tencent seems to be a bit different from attempted capture Ubisoft from Vivendi, which after all did not go down a few years ago. Vivendi was unable to raise the necessary 30% stake to force Ubisoft to ask them to file a takeover bid, and so Vivendi sold its shares. That’s how Tencent acquired them in the first place, even though they were far from the piece of Ubi pie they needed to get Guillemots to sell the company.
Hey, it’s even more consolidation in the gaming industry. Kind of, anyway. You can read the full statement from Ubisoft and Tencent here here.