Vivendi Could Drop its Ubisoft Takeover Bid, Talking With Other Actors

French media giant Vivendi has been engaging with French video game studio Ubisoft in a hostile takeover bid. Vivendi wants to integrate video games closer into the company's core business and sees Ubisoft as the most logical choice. However, a new interview with Gameloft (itself a Vivendi subsidiary) president Stéphane Roussel suggests that while Vivendi is actively looking into taking over Ubisoft, there are other potential parties Vivendi can turn to if necessary.

In an interview with the French tech publication Le Figaro, Roussel discussed Vivendi's video game aspirations, which he says Vivendi is valuing second only to its music business (Vivendi owns the Universal Music Group). Vivendi wants to assert a bigger presence in video games and needs a company bigger than GameLoft. Roussel says the company sees Ubisoft as the "most natural solution."

Ubisoft has been particularly strong in its response, fending off the takeover bid by increasing the founding Guillemot Family's stake in the company. And while Vivendi seemingly has its eyes set on Ubisoft, Roussel says "it's not Ubisoft of nothing" revealing that Vivendi has "discussions with other actors." This particularly true if Vivendi begins pursuing another bid that costs more than 1 billion Euros, in which case Roussel says Vivendi could drop its Ubisoft bid.

After losing the company's stake in Activision Blizzard, Vivendi began approaching Ubisoft and sister company GameLoft in a bid to take over the company. Roussel was put in charge of Gameloft after Vivendi took over the video game company in 2016. However, Ubisoft has had strong support in fending off a takeover from Vivendi with the help of its third largest investor Fidelity Investments. The two groups will reportedly block any attempts by Vivendi to install a board member from its own company when Ubisoft holds a general meeting in September.

Additionally, Reuters is reporting that Vivendi's bid for Ubisoft is becoming increasingly costly. Vivendi will apparently have to pay an estimated 30 percent premium for the controlling stake in Ubisoft. Analysts suggest Vivendi could have to pay as much as 5.4 billion Euros ($6 billion USD) for the remaining Ubisoft shares, which would be a lot for Vivendi whose net cash dropped to 473 million Euros at the end of March.

Vivendi remains keen on acquiring Ubisoft, and this is probably not a sign that the Guillemot family will be letting their guard down anytime soon.