Vivendi Raises Stake in Assassin's Creed Video-Game Empireby
Says may buy more of Ubisoft, Gameloft and seek board seats
$10-billion cash pile gives Vivendi more room for maneuver
Vivendi SA increased pressure on the Guillemot family’s French video-game empire, famous for blockbusters like Assassin’s Creed, by raising its stakes in Ubisoft Entertainment SA and Gameloft SE and saying it may eventually want some board seats.
The French media company with a $10 billion cash pile and run by Chairman Vincent Bollore, a billionaire with an activist investor past, increased its holding in the two developers to more than 10 percent and signaled Thursday it may add to the stakes as it expands its content business. Vivendi owns 10.4 percent of Ubisoft and 10.2 percent of Gameloft after spending about 438 million euros ($496 million) in total.
Ubisoft and Gameloft, which were created by the Guillemot brothers in France and compete with market giants Activision Blizzard Inc. and Electronics Arts Inc., said last week Vivendi’s move is unsolicited. Bollore’s move marks renewed interest from Vivendi in the video-game industry, after it gradually sold shares in Activision Blizzard Inc. over the past two years to retain only a 5.7 percent stake as of June.
“These investments are part of a strategic vision of operational convergence between Vivendi’s content and platforms on one hand and the Ubisoft and Gameloft productions in video games on the other,” Vivendi said. The Paris-based company, whose assets include the French pay-TV station Canal Plus, has also acquired 19.88 percent of Telecom Italia SpA as it seeks more influence in both content creation and distribution.
The Guillemots, five brothers who grew up by the seacoast in the western French region of Brittany, built their fortune by distributing Atari video games in the 1980s. They branched out into mobile-phone gaming in the early 2000s, and also own computer-accessories company Guillemot Corp.
Shares of Ubisoft were little changed at 25.32 euros at 11:22 a.m. in Paris, giving the Montreuil, France-based company a market value of 2.8 billion euros. The stock has gained 67 percent this year. Gameloft, up 35 percent in 2015, rose 2 percent to 4.51 euros for a market value of 383.5 million euros. The Guillemot brothers, who still run the companies, own minority stakes in each.
This isn’t the first time an unsolicited investor invites itself into Ubisoft’s capital. About 10 years ago, Electronic Arts had bought about 15 percent and prompted speculation about a takeover, until Ubisoft’s bigger rival sold its stake in 2010.
After Vivendi’s first approach, Ubisoft last week said it wants to remain independent. It had said the same years ago about Electronic Arts.
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 ultimately wants to influence strategy and initiate changes, people familiar with his plans have said.
Vivendi declined 1.6 percent to 21.24 euros, giving the company a market value of 29 billion euros.