Ubisoft buys itself back from Vivendi; Tencent new strategic partner

Ubisoft buys itself back from Vivendi; Tencent new strategic partner

Vivendi has had its eyes on Ubisoft for years now, buying more and more shares, but that takeover-in-the-making story comes to a close today - and not in the way many of us were expecting. New investors include the Ontario Teachers' Pension Plan and Chinese multimedia internet conglomerate Tencent.

"Tencent manages the largest online games community in China and one of the largest, most active social networks in the world, so this deal should help us dramatically increase our games' exposure and engagement in China", said Yves Guillemot, CEO and Co-Founder, Ubisoft. The remainder of Vivendi's stake, which is 8.0% of the capital, will be sold to institutional investors.

Additionally, the agreement sees Tencent and Ubisoft form a strategic partnership to boost the presence of Ubisoft's properties in China in the future. Tencent has acquired 5,591,469 Ubisoft shares, or 5.0% of its share capital. But Ubisoft has to be seen as the big victor here, as it managed to not only avoid the Vivendi takeover it's been struggling against, but actually eliminated the threat entirely. "It was made possible thanks to the outstanding execution of our strategy and the decisive support of Ubisoft talents, players and shareholders".

Tuesday's news ends a 2.5-year attempt by Vivendi to brute-force its way to owning a majority of Ubisoft through stock acquisition. Sounds to me like they have a vested interest in not setting quite as much homework...

Tencent is responsible for bringing the popular battle royale shooter PUBG to the mobile space
Tencent is responsible for bringing the popular battle royale shooter PUBG to the mobile space

"Today, Ubisoft and Tencent announced a strategic agreement in which Tencent will operate, publish and promote several of Ubisoft's most successful titles on PC and mobile in the Chinese market", the press release states.

Ubisoft bought back all of the Vivendi-owned Ubisoft shares, which are now accretive to all Ubisoft shareholders, meaning they will increase over time as accumulated share.

"The evolution in our shareholding is great news for Ubisoft". Ubisoft is perfectly positioned to capture the numerous video game growth drivers in the coming years. The progressive buy-back of the shares will be from 2019 to 2021, bolstering Ubisoft as a company.

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