In a surprise move, Ubisoft is spinning off some of its top franchises, including “Assassin’s Creed,” “Far Cry” and “Rainbow Six” into a new subsidiary. The separate entity is funded by a $1.25 billion investment (a 1.16 billion transaction in euros for the France-based Ubisoft) from gaming company Tencent, which will take a minority stake in the spun-off company.
Per Ubisoft, “This new subsidiary will focus on building game ecosystems designed to become truly evergreen and multi-platform. Backed by greater investment and boosted creative capacities, it will drive further increases in quality of narrative solo experiences, expand multiplayer offerings with increased frequency of content release, introduce free-to-play touchpoints, and integrate more social features.”
The new entity will be 100% controlled and consolidated by Ubisoft.
Currently, Tencent and the family of Ubisoft co-founder and CEO Yves Guillemot own 10% and 20%, respectively, of Ubisoft voting rights. While it was well known throughout the industry that Ubisoft leadership has been exploring a potential buyout or sale since first reporting lower than expected sales for “Star Wars Outlaws” last year and multiple delays of “Assassin’s Creed Shadows” (just released March 20), this spinoff move was not one of the anticipated outcomes.
“Today Ubisoft is opening a new chapter in its history,” Guillemot said. “As we accelerate the company’s transformation, this is a foundational step in changing Ubisoft’s operating model that will enable us to be both agile and ambitious. We are focused on building strong game ecosystems designed to become evergreen, growing high-performing brands and creating new IPs powered by cutting-edge and emerging technologies. With the creation of a dedicated subsidiary that will spearhead development for three of our largest franchises and the onboarding of Tencent as a minority investor, we are crystalizing the value of our assets, strengthening our balance sheet, and creating the best conditions for these franchises’ long-term growth and success. With its dedicated and autonomous leadership team, it will focus on transforming these three brands into unique ecosystems.
“We are committed to building a sharper, more focused organization-one where talented teams will take our brands to the next level, accelerate the growth of emerging franchises, and lead innovation in next-generation technologies and services, all with the gal of delivering enriching, memorable games that exceed players’ expectations, and create superior value for our shareholders and other stakeholders.”
Tencent president Martin Lau added: “We are excited to extend our longstanding partnership with Ubisoft through this investment, which reflects our continued confidence in Ubisoft’s creative vision and exceptional talent to drive sustained success in the industry. We see the immense potential for these franchises to evolve into long-term evergreen game platforms and create engaging new experiences forgamers.”
