Assassin’s Creed Maker Ubisoft Catches Eye Of Private Equity

Picture: Ubisoft

Private equity firms could start circling Ubisoft, Bloomberg reported Friday. The talks are early, but include interest from companies like Blackstone Inc. and KKR & Co. While not private equity, current and former Ubisoft developers Kotaku has engaged with interviewed over the past few months believe the company will eventually sell to someone in the midst of a falling stock. price and ongoing production struggles.

Bloomberg reports that Blackstone and KKR & Co., the world’s two largest private equity firms, have “investigated the French business” and have “a preliminary buyout interest” in Ubisoft, but the company has not. yet concluded “any serious negotiations with potential buyers.

According to Kotaku’s sources, Ubisoft has worked closely with several external consulting firms in recent years to audit various parts of its business. While companies will do this to become more profitable and prepare for the future, sources Kotaku spoke to suggest this is a sign that Ubisoft is trying to put its books away for a potential sale.

On a flurry of recent major game acquisitions, including Grand Theft Auto publisher Take-Two buy zyngasony buy Bungieand Microsoft’s $69 billion deal to absorb Activision Blizzard, it looks like a game of eat or be eaten for those left behind. EA CEO Andrew Wilson said as much during an earnings call earlier this year, in which he placed the FIFA publisher firmly in the camp of “big fish looking to eat game”. other fish”.

Ubisoft has been more timid about its survival strategy. When asked on his last earnings call why the French publisher had apparently received no interest in the offer, chief financial officer Frédérick Duguet said he would not speculate on why any offer had been made, before being corrected by CEO and co-founder Yves Guillemot. The company, says Guillemot, neither confirms nor denies “if” potential buyers had approached him.

Beyond Good and Evil 2 has been bleeding money and MIA for years. Picture: Ubisoft

If someone wanted to buy Ubisoft, they would potentially get it at a huge discount. The stock was above $110 per share in July 2018. It is now at $41. But they would still need to go through the Guillemot family, which is currently estimated at 15% of the market capitalization company of just under $5 billion.

CEO Yves Guillemot celebrates repelled a hostile takeover attempt by French media conglomerate Vivendi after securing funding from Tencent and others in 2018. But some current and former sources within the company now believe the 35-year video game industry veteran may be seeking an exit strategy.

They point the departure of his son Charlie Guillemot last year which means that there are no more parents to take over the family business. Ubisoft was also hit by a continuous wave of attrition among his senior talents. He continues to struggle with the aftermath of a consideration in the workplace for sexual misconduct which began in the summer of 2020. And some of its biggest projects continue to face upheaval, delays, or being trapped in development hell.

Like Bloomberg communicated in February, Ubisoft has decided to turn one of Assassin’s Creed Valhalla’s planned DLCs into a standalone interim game instead to help fill holes in its release schedule over the next 18 months. In the meantime, the next Far Cry, Ghost Recognitionand full-fledged Assassin’s Creed games remain further away than Ubisoft previously anticipated, according to three sources familiar with their development.

When asked for comment, a Ubisoft spokesperson sent Kotaku the following statement:

We do not comment on rumors or speculation. Ubisoft has unrivaled creative and production capabilities, with more than 20,000 talented people collaborating in our global studios on game development. Thanks to them, our long-term approach and our appetite for creative risk-taking, we have built some of the strongest proprietary brands in the industry and have many exciting new brands and projects on the horizon. We also have one of the industry’s most comprehensive and diverse portfolios of cutting-edge services and technologies, and a large and growing community of engaged players. As a result, we are uniquely positioned to capitalize on the rapid industry growth and platform opportunities that are emerging right now.

Correction: 4/23/22, 1:51 PM: A previous version of this article referenced the wrong Ubisoft stock symbol.