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What does CH think about this?Slowly but surely, Vivendi is trying to get back into the video game industry. After selling back its stake into Activision Blizzard in 2013, the company is looking at another video game giant — Ubisoft. Here’s a quick recap.
Ubisoft is one of the biggest game developers and publishers in the world behind popular franchises, such as Assassin’s Creed, Far Cry, Tom Clancy games and more. Gameloft is a successful mobile developer that copies popular gaming licenses and port them over to iOS and Android.
On October 14, Vivendi announced that it had bought 6.6 percent and 6.2 percent of Ubisoft and Gameloft, respectively. But that was just the beginning. One week later, the company announced that it owned 10 percent of each company.
As of today, Vivendi owns 17.34 percent of Gameloft, representing 15.34 percent of voting rights. It also own 10.81 percent of Ubisoft. In many ways, Vivendi is acting like an activist investor, buying shares on the public market to gain board control.
In particular, Vivendi isn’t negotiating with other Ubisoft shareholders and members of the management team. And guess what — they’re angry!
The Guillemot brothers founded both companies and they still own a significant chunk of both. Yves Guillemot heads Ubisoft, while Michel Guillemot heads the other. They want to prevent a Vivendi acquisition.
For now, Vivendi and the Guillemot family are fighting using public statements. In short, Vivendi is saying that it doesn’t exclude acquiring a majority stake in both companies, and the Guillemot brothers are saying that they don’t want that.
As a temporary fix, the Guillemot brothers increased their stake into Gameloft. They now own 15.64 percent of Gameloft, representing 24.18 percent of voting rights. It makes it a bit harder for Vivendi to grab control of the board.
But increasing their share in Gameloft was easy as the company is only worth $520 million while Ubisoft is worth $3.1 billion. Eventually, it will be hard to stop Vivendi if it really wants to acquire Ubisoft.
As a reminder, Vivendi owns Universal Music Group, Canal+, Dailymotion and has a lot of cash due to recent operations. In particular, Vivendi recently sold SFR, a telecommunications company.
The Guillemot brothers are waiting for a white knight, a company with deep pockets that would work with Ubisoft’s and Gameloft’s management teams to acquire a significant stake in both companies and stop Vivendi. But it’s been a few months already, and there is no white knight in sight.