HONG KONG, Aug 4 (Reuters) - Tencent Holdings Ltd plans to raise its stake in French video game group Ubisoft Entertainment SA as the Chinese gaming giant pivots to the global gaming market, four sources with direct knowledge of the matter told Reuters.
China's largest social network and gaming firm, which bought a 5% stake in Ubisoft in 2018, has reached out to the French firm's founding Guillemot family and expressed interest in increasing its stake in the firm, the sources said.
It is not clear how much more Tencent plans to own in Ubisoft, valued at $5.3 billion, but Tencent aims to become the single largest shareholder of the French company with an additional stake purchase, two of the sources said.
Tencent plans to buy a part of the additional stake in Ubisoft, the maker of the blockbuster "Assassin's Creed" video game franchise, from the Guillemot family, which owns 15% of the firm, three of the sources said.
Tencent could offer up to 100 euros ($101.84) per share to acquire the additional stake, two of the sources with knowledge of the internal discussions, said. It paid 66 euros per share for the 5% stake in 2018.
At the top end of 100 euros per share, Tencent's offer will be a premium of 127% to the stock's 44 euros average price over the past three months, and is close to its historical price ceiling at 108 euros in 2018.
Tencent has submitted to the Guillemot family a term sheet - a non-binding offer describing the basic terms and conditions of an investment, said one of the people, with a price "way above" the company's current price to ward off potential competition.
The aggressive offer also comes as global gaming power houses have been rushing to snap up quality independent game makers in recent years, which are in scarcity, two of the sources said.
Another publisher getting acquired possibly.
Shamelessly ripped from another forum