Ubisoft Crisis: Core Franchises Could Split into Separate Company
The crisis at Ubisoft is heading: the publisher may want to use his crown jewels into a separate company. The surprising thing about it: In the end, this could be worth more than Ubisoft itself. Tencent is already ready as an investor.
Radical conversion planned at Ubisoft
The French game publisher Ubisoft may face one of the greatest upheavals in its company history. After a weak financial year 2024 with a drop in sales of almost 50 percent in the important Christmas quarter, the company should now consider a step that resembles a insulation: the outsourcing of valuable game brands into a separate business unit. The Chinese technology group Tencent, already the second largest shareholder in Ubisoft, signals interest in a minority stake in the new unit, according to industry reports. Other international investors were also contacted.
How Bloomberg (Paywall) reports, the first preliminary offers should still be received in March. In the end, the new unit could be more worth more than the parent company Ubisoft itself. The Guillemot family, which Ubisoft founded and continues to control, is under enormous pressure. The share price has been continuously fallen in the past four years, and 43 percent in 2024 alone. Why does the step for Ubisoft make sense?
- Focus on more profitable brands: The new unit contains only strong brands such as Assassin’s Creed, Far Cry and Tom Clancy’s.
- Higher interest in investors through clear focus: the new unit is free of financial contaminated sites and can concentrate on the most lucrative brands, which makes it more attractive to buyers and investors.
- Better market positioning: The new company could position itself specifically for a sale or IPO.
- Bad state of Ubisoft: Ubisoft has lost in the market value and investor trust, while the new unit starts unencumbered.
Core brands in focus
Assassin’s Creed is one of the most valuable brands in the Ubisoft portfolio. The series has sold over 200 million times since its introduction in 2007 and is considered the crown jewel of the publisher. Other established brands such as Far Cry and the Tom Clancy series could also be part of the restructuring and attract investors.
The possible restructuring and the lack of transparency of Ubisoft have also caused resentment in shareholders. The current allegation: The Ubisoft leadership has already taken a quiet and secret negotiations with potential buyers such as Microsoft or Electronic Arts – without informing them.
Difficult times
The recent game publications such as Star Wars Outlaws and Xdefiant remained behind the expectations. The setting of several projects and the closure of studios in San Francisco, Osaka and Leamington could not stop the downward trend.
The possible outsourcing raises questions about the future of less successful Ubisoft brands. Longs such as Prince of Persia, Rayman or Beyond Good & Evil could also be sold or set.
