Chinese tech giant Tencent increased its stake in Ubisoft via an investment in an entity controlled by the Guillemot family who founded the French gaming firm.
"What this transaction does appear to signal is that any full sale of Ubisoft to a strategic or financial buyer is very unlikely. In our view this should be seen as a net negative for shares ," analysts at Cowen said in a note Tuesday.
As part of the deal, Tencent is able to increase its direct stake in Ubisoft from 4.5% currently to 9.99% of the capital or voting rights. But Tencent will not be able to sell its shares for five years and will not be able to increase its stake in Ubisoft beyond 9.99% for a period of eight years. That effectively rules out a complete takeover of the gaming firm.
Ubisoft's drama began in 2015 when French media conglomerate Vivendi took a stake in the European gaming firm, eventually becoming its biggest shareholder. But the Guillemot family were determined to keep the company independent. In 2018, after a three-year battle, Vivendi dropped its pursuit of Ubisoft. Tencent stepped in to buy some of the Ubisoft shares Vivendi offloaded and the Chinese tech giant
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