Today, Ubisoft announced that Tencent has acquired a minority stake in Guillemot Brothers Limited and has entered into the concert with the company’s founders.
“The expansion of the concert with Tencent further reinforces Ubisoft’s core shareholding around its founders and provides the company with the stability essential for its long-term development,” said Yves Guillemot, CEO and Co-Founder, Ubisoft.
“In a context where platforms and business models are converging, this transaction, which validates our strategy and highlights the strong intrinsic value of the assets we have built over the long term, is excellent news for our teams, gamers, and shareholders. Tencent is a key shareholder partner for many of the industry’s leaders, who have created some of the most outstanding video games. This transaction reinforces our ability to create strong value over the coming years.”
“The team at Ubisoft has shown an impressive ability to consistently create world-class entertainment along with a diverse portfolio of brands that include some of the most successful franchises in the industry,” said Martin Lau, President of Tencent. “We are excited to expand our engagement with the founders, the Guillemot family, as Ubisoft continues to develop immersive game experiences and to bring some of Ubisoft’s most well-known AAA franchises to mobile. This agreement also aligns with our philosophy to invest alongside creative founders with full confidence that they will lead their companies to new heights.”
Transaction details
Tencent acquires a 49.9% economic stake with 5% voting rights in Guillemot Brothers Limited.
Tencent’s investment in Guillemot Brothers Limited amounts to €300 million (€200 million share acquisition and €100 million capital increase), at an implied valuation for Ubisoft of 80€ per share.
In addition, Tencent is providing Guillemot Brothers Limited with a long-term unsecured loan to refinance its debt and provide additional financial resources that can be used to acquire equity in Ubisoft.
Guillemot Brothers Limited remains exclusively controlled by the Guillemot family. Tencent will not be represented on its Board of Directors and will not obtain any consent or veto rights over the business.
Expansion of Ubisoft founders’ concert
The Guillemot family concert with respect to Ubisoft is extended to include Tencent.
The expanded concert may increase its stake to 29.9% of Ubisoft’s capital or voting rights. Within this limit, Guillemot Brothers Limited and the Guillemot family may each increase their equity ownership in Ubisoft. Additionally, Ubisoft’s Board of Directors has authorized Tencent to increase its direct stake in Ubisoft from 4.5% to 9.99% of the capital or voting rights. Tencent will not be able to sell its shares in Ubisoft for a period of 5 years (and beyond will give the Guillemot family a right of priority) and will not be able to increase its stake in Ubisoft beyond 9.99% of Ubisoft’s capital and voting rights for a period of 8 years.
As a result of this transaction, Ubisoft’s governance will remain unchanged and Tencent will not have any operational veto rights.
| Number of Shares | Number of Voting Rights | % of Shares Outstanding | % of Voting Rights | ||||||||||||||
| Pre- money | Post-money | Pre- money | Post-money | Pre-money | Post- money | Pre- money | Post-money | ||||||||||
| Guillemot Family (including Guillemot Corporation SA) | 3,272,391 | 2,222,224 | 6,480,512 | 4,380,178 | 2.6% | 1.8% | 4.7% | 3.2% | |||||||||
| Guillemot Brothers Ltd | 16,036,032 | 17,086,199 | 22,985,864 | 24,036,032 | 12.8% | 13.6% | 16.7% | 17.6% | |||||||||
| Of which Ubisoft shares held by Guillemot Brothers Ltd via derivative contracts | 9,086,199 | 9,086,199 | 9,086,199 | 9,086,199 | 7.2% | 7.2% | 6.6% | 6.6% | |||||||||
| Tencent | 5,591,469 | 5,591,469 | 5,591,469 | 5,591,469 | 4.5% | 4.5% | 4.1% | 4.1% | |||||||||
| Concert | 19,308,423 | 24,899,892 | 29,466,377 | 34,007,679 | 15.4% | 19.8% | 21.4% | 24.9% | |||||||||
The agreement signed with Tencent reflects Ubisoft’s rich portfolio of assets, one of the most powerful in the video game industry:
A 17,000-person strong creative and production powerhouse structured around the “Lead & Associate” organization drawn from Ubisoft’s global network of studios and combining high AAA production standards with world-class creative and engineering talent.
The industry’s deepest and most diverse portfolio of proprietary brands, including Anno, Assassin’s Creed, Beyond Good & Evil, Brawlhalla, The Crew, Tom Clancy’s The Division, Far Cry, For Honor, Tom Clancy’s Ghost Recon, Hungry Shark, Just Dance, Might & Magic, Prince of Persia, Rabbids, Tom Clancy’s Rainbow Six, Rayman, Splinter Cell, Trackmania, Watch Dogs.
The company’s robust proprietary technologies include its cutting-edge engines (Anvil and Snowdrop), its online services and distribution platform (Ubisoft Connect), and Ubisoft’s rapidly expanding video game hosting business (i3D.net).
As a reminder, the strategic partnership with Tencent covers the development of mobile titles from several of Ubisoft’s major franchises and the launch of several of Ubisoft’s PC titles in China.
Disclaimer
This press release may contain estimated financial data, information on future projects and transactions and future financial results/performance. Such forward-looking data are provided for information purposes only. They are subject to market risks and uncertainties and may vary significantly compared with the actual results that will be published. The estimated financial data have not been audited by the Statutory Auditors. (Additional information is provided in the most recent Ubisoft Registration Document filed on June 14, 2022 with the French Financial Markets Authority (l’Autorité des Marchés Financiers)).
