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Report: Private Equity Eyeing Ubisoft As The Next Big Gaming Acquisition

Private equity firms could be beginning to circle over Ubisoft, Bloomberg reported Friday. Talks are early, but include interest from firms like Blackstone Inc. and KKR & Co. Even if it’s not private equity, senior current and former Ubisoft developers Kotaku has spoken with in recent months believe the company will eventually sell to someone amid a flagging stock price and ongoing production struggles.

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Bloomberg reports that Blackstone and KKR & Co., the two biggest private equity firms in the world, have been “studying the French business,” and have “preliminary takeover interest” in Ubisoft, but that the company hasn’t yet entered into “any serious negotiations with potential acquirers.”

According to Kotaku’s sources, Ubisoft has been working closely with several outside consultancy firms in recent years to audit various parts of its business. While companies will do this to become more profitable and prepare for the future, sources Kotaku spoke with suggest it’s a sign Ubisoft’s trying to tidy up its books for a potential sale.

On a wave of recent, big gaming acquisitions that include Grand Theft Auto publisher Take-Two buying Zynga, Sony buying Bungie, and Microsoft’s $69 billion deal to absorb Activision Blizzard, it seems like a game of eat or be eaten for those who remain. EA CEO Andrew Wilson said as much in an earnings call earlier this year, in which he placed the FIFA publisher firmly in the “big fish looking to eat other fish” camp.

Ubisoft has been more coy about its survival strategy. When asked in its most recent earnings call why the French publisher seemingly hadn’t received any bid interest, CFO Frédérick Duguet said he wouldn’t speculate on why no offer had been made, before being corrected by CEO and co-founder Yves Guillemot. The company, Guillemot asserted, was neither confirming nor denying “if” potential buyers had approached it.

If someone did want to buy Ubisoft, they would be potentially getting it at a huge discount. The stock was over $110 a share in July 2018. Now it’s at $41. But they would still need to go through the Guillemot family, which is currently estimated to own 15% of the just under $5 billion market cap business.

CEO Yves Guillemot famously fended off a hostile takeover attempt by French media conglomerate Vivendi after securing funding from Tencent and others in 2018. But some sources currently and formerly within the company now believe the 35-year video game industry veteran might be looking for an exit strategy.

They point to the departure of his son Charlie Guillemot last year resulting in no relatives left to take over the family business. Ubisoft has also been hit by an ongoing wave of attrition among its senior talent. It continues to struggle with the aftermath of a workplace reckoning over sexual misconduct that began in the summer of 2020. And some of its biggest projects continue to face upheaval, delays, or be trapped in development hell.

As Bloomberg reported in February, Ubisoft decided to turn one of Assassin’s Creed Valhalla’s planned DLCs into a standalone stopgap game instead to help patch holes in its release calendar over the next 18 months. In the meantime, the next Far Cry, Ghost Recon, and full-fledged Assassin’s Creed games remain further out than Ubisoft had previously planned, according to three sources familiar with their development.

When asked for comment, a spokesperson for Ubisoft sent Kotaku the following statement:

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