EXCLUSIVE – Ubisoft’s “Plan” For The Ubisoft/Tencent Subsidiary Detailed In Internal Memo

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A fresh internal memo from Ubisoft has surfaced, this time penned by Christophe Derennes (Zone 1 Managing Director), outlining the strategic blueprint for Ubisoft’s upcoming joint venture with Tencent.

The announcement about our new affiliate was made on March 27, and so far, we haven’t received many specifics about what this move might entail in the coming days. As of now, we only know that some Ubisoft teams and intellectual properties will be transferring to the new subsidiary. However, there’s been no word yet on how this change affects our company as a whole, future endeavors, or our employees, which remains unclear at the moment.

From my perspective as an ardent follower of Ubisoft, the value of their stock has plummeted a startling 19% since the news about the subsidiary broke online. One investor I spoke with, preferring to keep his identity confidential, attributed this drop in price to the uncertainty surrounding how the new partnership with Tencent and its cash injection will play out. Another investor voiced similar concerns, stating that this move may not hold much weight in the long run if there aren’t any additional changes within the company.

While conversing with several employees, I’ve noticed that many feel internal communication has been somewhat lackluster, beyond a few company-wide emails. Some also suggest that the deal may have been hastily arranged due to Ubisoft’s strong bargaining position following the initial success of Assassin’s Creed Shadows. However, the exact timing of when the deal was sealed is not precisely known.

In discussions with multiple employees, I’ve found that many perceive internal communication as inadequate, aside from a handful of company-wide emails. Additionally, some imply that the deal might have been hurried due to Ubisoft’s powerful negotiation position after the initial success of Assassin’s Creed Shadows, but the exact date the deal was closed is uncertain.)

After reviewing the company’s emails post the subsidiary announcement, the uncertainty about the future becomes more apparent. The most recent email from Christophe Derennes, obtained by TopMob, provides a clearer understanding as to why both investors and staff might be feeling uneasy.

But in short, it’s because Ubisoft doesn’t seem to have much of a plan, yet.

You can read the full memo below:

Greetings everyone,

I hope this message finds you well. By now, you’ve likely seen the announcement from Yves concerning our decision to establish a new Ubisoft subsidiary that incorporates three of our largest brands: Rainbow 6, Assassin’s Creed, and Far Cry. This new venture will maintain its ties with the Ubisoft family and will continue to be managed by us, while Tencent will hold a minority stake. This strategic move represents a significant turning point for us following some challenging years, offering Ubisoft an opportunity to rebuild more robustly than ever before.

So, what does this mean for Zone 1? Well, we can anticipate substantial changes in terms of structure and organization since these three brands account for a considerable portion of Zone 1’s population. Once the agreement is finalized and approved by legal authorities, our studios in Quebec, Saguenay, and Sherbrooke will transfer entirely to the new entity, while our Montreal project teams will be split between the new entity and the existing Ubisoft organization. Our Toronto, Winnipeg, Red Storm, and Blue Mammoth studios will continue their evolution within the current organization.

At this stage, we are only beginning the process, and I understand you may have numerous questions. However, for now, let me briefly outline our next steps:

1. This announcement serves as step one, where we’ve shared the decision and initiated the planning phase.
2. Over the coming months until summer, we will work on supporting the new entity alongside the existing organization and defining what this new model looks like for both parties. We will host various consultations and discussions during this period, with your leaders actively involved as we strive to set Ubisoft and the new entity up for success.
3. The implementation of the new model will follow, encompassing a longer transition period. While many details have yet to be determined, such as management of the new entity, impact on our studios, and more, rest assured that Ubisoft will remain a leading force in video game creation, with your creativity and dedication remaining vital to our success.

While we don’t have all the answers right now, I promise to keep you updated as we progress and share decisions as soon as they become available. In the meantime, we are excited about this opportunity to rebuild a stronger Ubisoft and maximize the contributions of each team member.

Thank you for your understanding and resilience during these changes – navigating change can be complex, and this is a significant one for us and the future of Ubisoft. I ask that you continue focusing on what you do best: creating exceptional games that bring joy to our players. I’m grateful for your cooperation as we embark on this journey together.

Best regards,

Christophe
Managing Director, Zone 1

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2025-04-01 16:49