Vivendi Raises Gameloft Stake to 26.7% With Buyout in Cards

  • Vivendi also own shares in Assassin's Creed maker Ubisoft
  • Gameloft's founding fathers are fighting the media empire

Vivendi SA stepped up pressure on the Guillemot family’s French video-game empire by increasing its stake in Gameloft SE to 26.7 percent, saying it doesn’t rule out a takeover should collaboration with the mobile-game developer fail.

Vivendi boosted its holding to 22.7 million Gameloft shares, representing a 112 million-euro ($121 million) investment, saying in an e-mailed statement Monday that it favors “a constructive approach.” The Paris-based company, which reached 20 percent of Gameloft on Dec. 1 and 25 percent just two days later, may continue to add shares depending on market conditions and may ask for a seat on the board, according to a regulatory filing.

The move escalates the face-off between the Guillemot brothers and Vincent Bollore, the billionaire with an activist investor past who now runs Vivendi. Bollore, Vivendi’s chairman, has in parallel made a grab for another of the Guillemot brothers’ creations, Ubisoft Entertainment SA, famous for blockbusters like Assassin’s Creed. Vivendi, with assets including the French pay-TV station Canal Plus, has also acquired over 20 percent of Telecom Italia SpA as it seeks more influence in both content creation and distribution.

Gameloft didn’t respond to an e-mail and calls seeking comment.

Gameloft rose 2.1 percent to 6.37 euros at 9:27 a.m. in Paris, giving the company a market value of 542 million euros. Vivendi lost 0.4 percent to 19.64 euros, for a market capitalization of 27 billion euros.

Both Gameloft and Ubisoft, which compete with market giants Activision Blizzard Inc. and Electronics Arts Inc., have rejected Bollore’s moves. Vivendi, which used to control Activision Blizzard, has gradually pared its stake over the past two years. The Guillemot brothers, who still run Gameloft and Ubisoft, own minority stakes in each. The family increased its voting stake to 25 percent last week, saying it will take the necessary measures to avoid a “creeping takeover.”

In October, Vivendi spent almost $500 million acquiring a 10 percent stake each in both companies. Only after the unsolicited approach on Ubisoft did Bollore get in touch to discuss possible synergies, Ubisoft Chief Executive Officer Yves Guillemot said in a Bloomberg News interview that month. “What Vivendi is doing, it shows a lack of respect for what Ubisoft is today and for all our shareholders,” he said at the time.

Bollore, Vivendi’s biggest shareholder, has led the company to accumulate 9 billion euros in cash after disposing of telecommunications assets in countries including France and Brazil -- only to come back to phone companies a few months later. At Telecom Italia, Bollore’s move has led to tensions with Italian and foreign investment funds after it requested four seats on the board.

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