With a Vivendi Takeover Looming, Thursday Is a Big Day for Ubisoft [UPDATE 2]

Vivendi did not seek board representation during the annual shareholders meeting.

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Update: Ubisoft's annual shareholders meeting has concluded. Vivendi did not seek a board seat or propose any resolutions, and Ubisoft's desired board members were approved, though Vivendi did cause some turbulence.

"Today during our Annual General Meeting, Ubisoft shareholders expressed massive support for Ubisoft's strategy and management," a company spokesperson told GameSpot. "We remain focused on the execution of our strategic roadmap, which has already proven successful and which we are confident will continue to deliver great results and value for all of Ubisoft's stakeholders. We're also very happy to welcome two new independent directors, Frederique Dame and Florence Naviner, who will bring their expertise and know-how to Ubisoft's board."

Both Yves Guillemot and Gerard Guillemot were re-elected to the board and "shareholders expressed massive support for the strategy and the management of Ubisoft," according to a press release.

Keep in mind, however, that today's events don't prevent Vivendi from moving forward with a hostile takeover attempt. For the time being, it won't have the influence of a board of directors member over Ubisoft.

Following the conclusion of the meeting, Vivendi released a press release entitled "Vivendi is Ubisoft's largest shareholder." In it, it states, "Vivendi considers that it would be good corporate governance for it to be represented on the company's board of directors considering its level of equity interest [22.8 percent]."

It goes on to note that it abstained from voting on resolutions during today's meeting, causing several of them to not pass. This is referenced in Ubisoft's press release, which stated that "some resolutions were rejected due to Vivendi's systematic obstruction, impeding the proper functioning of the company, in particular regarding its competitive compensation policy for its talents."

Ubisoft CEO Yves Guillemot and CFO Alain Martinez today. Image credit: Ubisoft
Ubisoft CEO Yves Guillemot and CFO Alain Martinez today. Image credit: Ubisoft

Vivendi went on to say, "Moreover, having taken full control of Gameloft, which employs 6,000 people and is experiencing satisfactory growth, Vivendi will pursue its strategy in video games, which complements the content it develops in the fields of music (Universal Music Group) and television (Canal+ Group) as well as its interests in distribution (FNAC), in audiovisual production (e.g. Banijay), and in Telecom Italia and Telefonica."

Yves Guillemot commented on the day's events in Ubisoft's press release, saying, "We are delighted by the continued support of the vast majority of our shareholders. Ubisoft is confidently pursuing its strategy of growth and value creation."

According to a report by French reporter Chloe Woitier on Twitter, the meeting concluded with a round of applause. CEO Yves Guillemot was described as looking "very relieved."

Original Story: French media company Vivendi has been making moves to take control of Assassin's Creed maker Ubisoft for the better part of a year now. Tomorrow may prove to be a significant day in that process, as Ubisoft will hold its annual shareholders meeting where Vivendi could attempt to secure seats on its board of directors.

According to the Wall Street Journal, a Vivendi spokesperson wouldn't comment on whether it intends to seek board representation at Thursday's meeting. Sources speaking with the WSJ said Vivendi doesn't plan to do so. However, sources indicated to Polygon that not seeking board seats would suggest it plans to attempt a hostile takeover.

"Since we became a shareholder, we have written requesting meetings but so far nothing has happened," a Vivendi spokesman told the WSJ. "We feel it would be normal as the main shareholder to have a seat on the board, but we're not in a hurry."

Ubisoft CEO Yves Guillemot wasn't shy in expressing what he wants to happen, saying, "We won't relax until they sell their shares. The creeping control strategy implemented by Vivendi is dangerous. We think that there's a great risk of shareholders losing value."

Ubisoft has not hidden its displeasure with Vivendi's acquisition of shares, a process which began last October when it bought a 6.6 percent stake in Ubisoft. At the time, Guillemot described the investment as "unsolicited and unwelcome," and he vowed to "fight to preserve our independence."

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Vivendi has continued purchasing shares (its stake now sits at 23 percent), but it has denied that it has immediate plans for a takeover. The company has a history of takeovers, including just recently mobile game developer Gameloft--which, like Ubisoft, was founded by the Guillemot family. Prior to that happening, speculation earlier this year suggested a Gameloft takeover could be part of an attempt to force talks with the Guillemots about a takeover of Ubisoft.

Ubisoft has made moves throughout the year to fight Vivendi. Guillemot met with potential investors in Canada to build support back in February, in part because the company would need at least 50 percent of voters to stop Vivendi from securing board representation during tomorrow's meeting. In July, Ubisoft nominated two independent directors for its board in an attempt to stave off a takeover. Those individuals, Frederique Dame and Florence Naviner, would be approved during tomorrow's meeting. They would bring the total number of independent directors (those who have no material relationship with the company whose board they sit on) up to five, representing the 50 percent mark Ubisoft had said it hoped to reach earlier this year.

Earlier this month, the Guillemots purchased an additional 3.5 percent of Ubisoft shares, bringing their total to over 12 percent. Ubisoft itself acquired a major mobile game company, Ketchapp, which it said makes it the fourth largest mobile game publisher in the world in terms of total downloads. Additionally, it announced plans to form a book-publishing division, which follows its foray into TV and movie production.

Earlier this month, Ubisoft hosted an event for the press, during which a key theme was Ubisoft's independence. Speaking with GameSpot, Yves Guillemot had a good deal to say about the subject, arguing that a takeover "threatens the construction and pillars of Ubisoft" and would remove Ubisoft's ability to take risks and be agile.

We may learn on Thursday whether that independence is truly in trouble.

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