Ubisoft spins out new unit for Assassin’s Creed and other games, Tencent to take $1.25 billion stake

Ubisoft on Thursday announced that it’s creating a new gaming subsidiary with Chinese technology giant Tencent investing 1.16 billion euros ($1.25 billion) into the unit.

The subsidiary will focus on Ubisoft’s best-known games brands, including Assassin’s Creed, Far Cry and Tom Clancy’s Rainbow Six, according to the company.

It will “focus on building game ecosystems designed to become truly evergreen and multi-platform,” Ubisoft said in a press release Thursday.

“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 company added.

The investment from Tencent values the new subsidiary at 4 billion euros, Ubisoft said, implying a 4x multiple based on its average sales from full-year 2023 to 2025.

“It highlights the strong value of Ubisoft’s IPs, significantly reinforces its balance sheet, and enables the company to continue its efforts to become a more agile organization, unleash the full creative potential of its teams and better align its resources with the constantly evolving expectations of players,” Ubisoft said.

The move follows months of speculation about Ubisoft’s future. In January, Ubisoft appointed advisors to review its strategic options, stoking rumors about a potential sale.

Earlier this month, Bloomberg reported that the games publisher was looking to bring in external investment in a new entity including some of its core intellectual property.

That followed reporting from Bloomberg last year that Tencent was discussing a possible take-private deal with Ubisoft’s founding Guillemot family.

News of the transaction also arrives a week after Ubisoft released Assassin’s Creed Shadows, the latest title in its best-selling franchise. The game was met with generally positive reviews from critics, garnering an average score of 82 on review aggregation site Metacritic.