Ubisoft Stock Jumps 14% After Reports Of Tencent Buyout

Ubisoft Entertainment SA (OTC:UBSFF) is in talks with Tencent Holdings ADR (OTC:TCEHY) over a potential buyout.

According to Reuters, the deal would allow Ubisoft’s founders, the Guillemot family, to retain control if the company goes private.

This development follows a difficult year for Ubisoft, marked by staff layoffs, disappointing sales, and the closure of several studios. Ubisoft’s stock jumped 14% after news of the buyout discussions emerged, as per BZPro.

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Privatization Could Mean Big Changes For Ubisoft

Sources have told Reuters that Ubisoft is exploring a deal that would allow it to buy back shares from public shareholders, essentially taking the company off the stock market.

While the Guillemot family wants to maintain control, Tencent's significant stake in the company means it will likely demand a larger say in future business decisions.

“We remain committed to making decisions in the best interests of all of our stakeholders,” a spokesperson for Ubisoft told Eurogamer. “In this context, as we have already indicated, the Company is also reviewing all its strategic options.”

Struggling With Financial Losses

The buyout discussions come amid tough financial times for Ubisoft. The company has faced layoffs, staff walkouts, and a series of underperforming game releases. Star Wars Outlaws sold below expectations, and Assassin’s Creed Shadows, one of Ubisoft's flagship titles, has been delayed until February 2025.

Earlier this week, Ubisoft announced it would close several studios, cutting 277 jobs, while pulling the plug on the live-service shooter XDefiant.

Tencent's Growing Influence

Tencent, already the second-largest shareholder of Ubisoft, has been increasingly active in the gaming industry, having acquired stakes in major companies such as Epic Games and Riot Games.

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