Game On: Guillemot family, Tencent in talks over Ubisoft buyout

“Game On” is The Fly’s weekly recap of the stories powering up or beating down video game stocks.

NEW RELEASES: This week’s most significant new game release is Microsoft’s (MSFT) “Indiana Jones and the Great Circle,” which launched for PC and Xbox Series X/S on December 9, with a PlayStation 5 (SONY) release set for the first half of 2025.

UBISOFT BUYOUT TALKS: The Guillemot family, which is the largest and founding shareholder of Ubisoft (UBSFY), has been in talks with Tencent (TCEHY) and other investors in recent weeks about funding a management-led buyout of the video games maker, two people familiar with the matter told Reuters’ Amy-Jo Crowley and Julie Zhu. Shareholders are considering how to structure a possible buyout of France’s largest video games maker without reducing the founding family’s control, the report noted. The news comes two months after Bloomberg reported that the Guillemot family was considering taking the game maker private.

HULST ON AI: Hermen Hulst, co-CEO of Sony Interactive Entertainment with Hideaki Nishino, told BBC that while artificial intelligence has the potential to “revolutionize” video games, he believes it will never replace the “human touch” of the medium made by actual human beings. The PlayStation boss acknowledged that advancements in AI technology would change the sector, but added that there will always be a future for people. “I suspect there will be a dual demand in gaming: one for AI-driven innovative experiences and another for handcrafted, thoughtful content,” he told the BBC. “Striking the right balance between leveraging AI and preserving the human touch will be crucial.”

FROMSOFT NOT CURRENTLY WORKING ON ‘ELDEN RING’ SEQUEL: FromSoftware president Hidetaka Miyazaki said the video game studio is not currently considering making a sequel to 2022’s hit game “Elden Ring,” which was published by Bandai Namco (NCBDY), but won’t fully shut down the possibility of a sequel in the future, IGN’s Ryan Dinsdale reported last week, citing comments from the PlayStation Partner Awards 2024 Japan Asia. The game maker, which also develops the “Dark Souls” and “Armored Core” franchises, has a number of projects in the works, though none are continuations of “Elden Ring,” the author notes. “We’re not really considering developments such as an Elden Ring 2,” Miyazaki said. The Fly notes that Sony is reportedly in talks to acquire Kadokawa, which owns a majority stake in FromSoftware.

BMO UPS TAKE-TWO TARGET: Late last week, BMO Capital analyst Brian Pitz raised the firm’s price target on Take-Two (TTWO) to $240 from $190 and keeps an Outperform rating on the shares. The firm estimates the company selling 45M GTA VI units when the title launches in the fall of 2025, implying 35% penetration among the 130M PS5 and Xbox Series X/S owners, the analyst tells investors in a research note. There was a material increase in franchise interest over the last decade, and BMO anticipates the upcoming launch to be a catalyst for Holiday 2025 console sales, the firm added.

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MORE VIDEO GAME NEWS:

• Square Enix’s (SQNXF) “Dragon Quest III HD-2D Remake” has(NTES) “Marvel Rivals” hit the 10M player mark in its first 72 hours of availability
• “Fortnite OG,” a new game mode for Epic’s “Fortnite” that restores the original version of the game from many years ago, garnered over 1M concurrent players for the regulator build mode within 20 minutes of availability, shut down “XDefiant” in June 2025