Ubisoft and Tencent are reportedly discussing the formation of a joint asset venture that could see Ubisoft essentially broken into parts, according to a Bloomberg report. This move, if finalized, would serve as an alternative to Tencent financing a complete private buyout of the struggling developer-publisher.
Ubisoft’s Recent Challenges
The post-pandemic period has been particularly challenging for Assassin’s Creed developer. Several big-budget projects underperformed commercially, causing its stock price to plummet by over 80% since the start of the decade. In late 2024, the company announced it was exploring “strategic options” as its share price hit a 12-year low. Reports at the time suggested that a Tencent-financed private buyout was being considered.
However, new information indicates that Tencent and the Guillemot family, which holds significant control over Ubisoft, are evaluating a joint venture involving select Ubisoft assets instead of pursuing a full buyout.
Tencent’s motivation appears to be boosting Ubisoft’s value while gaining more control over key properties. As a minority shareholder with approximately 10% ownership, the proposed joint venture would allow Tencent to increase its influence in Ubisoft while also strengthening its presence in the global video game market.
While no final decision has been made, sources suggest the venture could incorporate the company’s most valuable franchises, such as Assassin’s Creed. This aligns with Tencent’s interest in securing high-profile IPs to support its international gaming ambitions.
The creation of a spin-off venture could preclude Ubisoft from going fully private. By isolating and leveraging high-value assets, Ubisoft and Tencent may see an opportunity to stabilize the company without requiring a full buyout. This move could also help mitigate the risks of an outright acquisition, especially as Tencent faces regulatory scrutiny in several markets.
The company’s most recent blockbuster was Assassin’s Creed Valhalla, which achieved over $1 billion in revenue. However, the company has struggled to replicate this success. The next major entry, Assassin’s Creed Shadows, is now slated for a March 20 release after two delays. This timing is critical, as it gives Ubisoft only 11 days to boost its financials for the fiscal year ending March 31. That said, with discussions still ongoing, the future of Ubisoft’s structure remains uncertain.
