Tencent Just Spent Over $1 Billion To Own 25% Of A New Ubisoft Subsidiary Focused On 3 Key IPs

Tencent just shelled out over a billion dollars to become a 25% minority stakeholder in a new subsidiary that Ubisoft has created. The subsidiary will focus on three core IPs: Assassin's Creed, Far Cry, and Tom Clancy's Rainbow Six. All remaining Ubisoft IPs will stay part of the original company. The price for Tencent's stake comes in at €1.16BN (roughly $1.25 billion). That puts a valuation on the new subsidiary at over $4 billion dollars, which really just shows how much outside investors value just 3 of Ubisoft's IPs given that this valuation is slightly higher than Ubisoft itself is currently.

According to the press release, "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 deal will still need to clear a few hurdles before its expected closing date by the end of the year. Finexsi has been selected to perform an issuance of fairness opinion, regulatory approvals will be required, and teams in studios around the world will need to be shuffled based on the IPs they are working on now/will work on in the future.

Ubisoft will focus on "nurturing the development of iconic franchises including Tom Clancy’s Ghost Recon and The Division."

CEO Yves Guillemot, who got exactly what he wanted when we reported on this possible outcome a few weeks ago, said “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."