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Vivendi Ups Ubisoft Ownership Just Days After E3
With its takeover of Gameloft nearly complete, Vivendi is wasting no time pushing ahead with its creeping control of Ubisoft. A new stock purchase puts the former Activision owner in control of 20.1 percent of Ubi shares and 17.76 percent of voting rights.
Vivendi and its supervisory board chairman Vincent Bolloré have made their interest in an Ubisoft board seat known. With a general shareholders meeting in September, Ubisoft has a hard fight ahead.
There is a limit to how much Ubisoft stock Vivendi can buy, though. French law dictates that once a shareholder controls 30 percent of a company, they must tender an offer, something Vivendi has said it has no interest in doing. The company reiterated that it doesn't plan to make a move for at least the next six months, which will spill the fight until at least the September 2017 shareholders meeting.
However, not all is lost. Vivendi’s Gameloft takeover was possible in part because of that target’s localized presence in France. Ubisoft, however, is a multinational firm.
Vivendi apparently leaned heavily on its relationships in France, but won’t have the same sway with institutional investors, like Blackrock and Fidelity that aren’t as accessible to Bolloré. Additionally, Ubisoft has a strong employee group that owns stock and likely has no interest in seeing company CEO Yves Guillemot ousted.
Last week, Guillemot also told CNBC it would be interested in exploring a partnership. This is different than the White Knight scenario mentioned in our explainer, as it would be a meeting of equals rather than an acquisition of the Assassin’s Creed publisher.
A merger could come from the gaming world or another entertainment company, as Ubisoft has entered the movie and television business. The company could also take additional investment from an institutional investor.
We’ve reached out to Ubisoft about the latest stock buy. We’ll update should there be a new statement.
[Source: Bloomberg]
Our Take
It’s clear that there is reason for Ubisoft to be concerned, but the situation here is much different than the one that Gameloft faced. The two companies, while founded by the same family, have different profiles that give Ubisoft a fighting chance.
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