This past week, reports began to circulate that with inner turmoil and a long-declining stock price, Ubisoft may soon be looking for a buyer. The report from Bloomberg says that the current potential buyers are not big guns in the gaming industry, but instead, private equity. They list Blackstone Inc. and KKR & Co. as potentials.
I have no idea what private equity would do with a place like Ubisoft, but seeing what private equity does when it buys say, newspapers or online outlets, that doesn’t sound terribly promising. So I wonder if the end result of this could be Ubisoft selling to one of the private equity firms, then those firms flipping it to an actual games industry buyer. Or if to prevent the vultures from circling, someone like Sony or Microsoft steps in for yet another huge gaming industry purchase.
Why is Ubisoft in trouble these days and potentially looking for an out? Among other things:
Beyond Good and Evil 2
All of this has led to a long term stock slide down from a high of $23 a share in 2018 to now just $9 today. They have a market cap of 4.72 billion Euros, or about $5 billion USD, which looks like a somewhat easy acquisition for either Sony, who just spent $3.6 billion on Bungie, who makes a single game, or Microsoft, who just spent a colossal $68.7 billion on Activision Blizzard, subject to regulatory approval.
Sony or Microsoft buying Ubisoft and making its IPs exclusive would land them Assassin’s Creed, Far Cry, Watch Dogs, a billion Tom Clancy games, Beyond Good and Evil, Just Dance, Prince of Persia, Rabbids and a lot more. Though the question remains what each of those IPs and current projects are worth these days, and what the priorities would be moving forward after an acquisition. Would a purchase change the questionable fate of Beyond Good and Evil 2? That seems unlikely.
To me, this would make less sense for Sony with its more limited budget, given the baggage that comes with Ubisoft. Microsoft essentially wants to own a massive chunk of the industry with all these purchases, so that makes the most sense for the “low” price of just a few billion. As for this current option, being sold to private equity, that would make me doubt the long term survival of the company as a whole.
Follow me on Twitter, YouTube, Facebook and Instagram. Subscribe to my free weekly content round-up newsletter, God Rolls.
Pick up my sci-fi novels the Herokiller series and The Earthborn Trilogy.