Tencent plans to increase its stake in Ubisoft Entertainment, paving the way for a shift into the global gaming market, according to four sources.
Tencent acquired a 5% stake in Ubisoft in 2018 and contacted the Guillemot family of Ubisoft's founders to express interest in increasing their stake in the company, according to the company. It is unclear how much stake Tencent plans to take in Ubisoft, but Tencent aims to become the single largest shareholder in Ubisoft by buying additional shares, the people said.
Ubisoft is currently valued at around $5.3 billion, and Tencent has offered to increase its stake in Ubisoft at €100 per share (it bought it in 2018 for €66 per share). The report said Tencent was "very determined to win the deal" to make Ubisoft a strategically important asset.
According to Reuters, Tencent has now submitted a term sheet - a non-binding offer describing the basic terms and conditions of the investment - to the Guillemot family at a price "significantly higher" than the company's current price to fend off potential competition.
Tencent and Ubisoft declined to comment.