Investors Urge Ubisoft to Go Private as Share Prices Continue to Plummet

gamingbolt.com:

Things are continuing to look shaky for Ubisoft. Last week, reports emerged that the company had seen a drop in its stock prices following a middling launch for Star Wars Outlaws and the continued underperformance of XDefiant. Unfortunately for Ubisoft, the situation hasn’t improved much since then.

For starters, at the time of writing, the company’s share price currently sits at €13.67, having dropped by another 7.13 percent over the course of the day. That also means the company’s share price has now plummeted by over 50 percent in the last year.

Amidst this drastic downturn, hedge fund AJ Investments – a minority shareholder in Ubisoft – has published an open letter, in which it expresses its”deep dissatisfaction with the current performance and strategic direction of the company” and brings up “concerns about the management’s ability to deliver
value to shareholders over the long term.”

The letter has called for Ubisoft to either be taken private, or be sold to a “strategic investor”, with the investor group stating it believes Ubisoft’s appropriate share price should be €40-45. It also calls for a change in management for the company, including replacing Yves Guillemot as CEO.

“The main reason why the valuation is so low compared to the peers is that Ubisoft at current state
is mismanaged and shareholders are hostages of Guillemot family members and Tencent who
take advantage of them,” the letter reads. “Management is focused on pleasing investors with beating quarterly results and not focusing on long-term strategy to provide exceptional experience for the
gamers.”

Star Wars Outlaws launched in August to somewhat mixed reviews, with creative director Julian Gerighty expressed his disappointment over review scores in the aftermath.

Ubisoft’s next major release is Assassin’s Creed Shadows, which is due out this November.