Ubisoft Shares Slump After Investor Urges Assassin’s Creed Maker to Go Private
Slovakia-based AJ Investments said it was unsatisfied with the current performance and strategic direction of the company
Shares of Ubisoft UBI -6.05%decrease; red down pointing triangle Entertainment plunged Monday after a minority investor called for the maker of the Assassin’s Creed videogame franchise to go private and install a new management team.
AJ Investments, a hedge fund based in Slovakia that holds less than 1% in Ubisoft, said in a letter to management that it was unsatisfied with the current performance and strategic direction of the company.
Ubisoft has been facing a number of setbacks in recent months. It no longer expects to release “Rainbow Six Mobile” and “The Division Resurgence” in the fiscal year ending in March 2025, saying in July that developers needed extra time to ensure the games meet players’ expectations.
The delays came after the group ceased development of “The Division Heartland,” a decision it made to redeploy resources to bigger releases such as “XDefiant.” Its share price has tumbled more than 50% over the last 12 months. Shares in Paris were down more than 9% on Monday after AJ Investments published its letter to Ubisoft management.
Juraj Krupa, founder and chief executive of AJ Investments, said he wanted the letter to be a wake-up call for other investors. The hedge fund said Ubisoft should go private and urged the founding Guillemot family not to block a sale process. It also called for the installment of a new chief executive willing to weigh the sale of some studios and lay off staff to cut costs.
Ubisoft didn’t respond to a request for comment on the letter.
Five Guillemot brothers founded Ubisoft in 1986 as they saw promise in the up-and-coming world of tech and software development. The company is one of few remaining independent gaming studios that develops immersive games—making it a target for takeovers.
Chief Executive Yves Guillemot led a battle nearly a decade ago to fend off a takeover attempt by French media conglomerate Vivendi. The Guillemot family wields a stake of more than 13% in the group, according to FactSet, more than any other shareholder.
Chinese internet giant Tencent Holdings in 2022 moved to acquire a minority stake in the family holding, though it didn’t get any board seats or veto rights as part of that deal.
Ubisoft managed to remain independent even as a wave of consolidation swept through the videogame industry in 2022, with Take-Two Interactive Software agreeing to buy Zynga, Microsoft buying Activision Blizzard and Sony Group’s videogame unit striking a deal to buy Bungie.
Guillemot said at the time that Ubisoft could stay independent, citing its balance sheet and game portfolio. However, he said that if any offer was received, it would be reviewed with the interests of stakeholders in mind.