Yves Guillemot, CEO and co-founder of Ubisoft, speaks on the Ubisoft Forward livestream event in Los Angeles, California, on June 12, 2023.
Robyn Beck | AFP | Getty Images
Shares of French game maker Ubisoft popped 9% in Europe trading Tuesday after Microsoft submitted a recent deal for the takeover of Activision Blizzard to attempt to appease wary U.K. regulators.
The U.K.’s Competition and Markets Authority confirmed it blocked the unique $69 billion deal that Microsoft first recommend in January 2022. The acquisition has also faced regulatory challenges within the U.S. and Europe, however the CMA has been the hardest critic of the takeover, citing concerns that the deal would hamper competition within the nascent cloud gaming market.
The CMA said Microsoft and Activision Blizzard have agreed to a recent, restructured agreement, which the CMA will now investigate with a choice deadline of Oct. 18. As a part of the brand new deal, Microsoft is not going to acquire cloud rights for existing Activision Blizzard PC and console games, or for brand new games released by Activision Blizzard in the course of the next 15 years, the CMA said. As a substitute, these rights can be divested to Ubisoft before Microsoft’s acquisition of Activision Blizzard.
“The agreement provides Ubisoft with a singular opportunity to commercialize the distribution of games via cloud streaming,” Brad Smith, president of Microsoft, said in a blog post. “The agreement will enable Ubisoft to innovate and encourage different business models within the licensing and pricing of those games on cloud streaming services worldwide.”
Ubisoft publishes popular games from the Assassin’s Creed, Tom Clancy’s Rainbow Six and Far Cry franchises.
The restructured deal is meant to offer an independent third party with the flexibility to supply Activision Blizzard’s gaming content to all cloud gaming service providers, including Microsoft itself. Ubisoft offers cloud games on services like Amazon Luna and Nvidia‘s GeForce Now, which compete with Microsoft’s Xbox streaming service.
Smith said Ubisoft will compensate Microsoft through a “one-off payment” and a “market-based wholesale pricing mechanism” that features pricing options based on usage.
— CNBC’s Arjun Kharpal contributed to this report.
Correction: Ubisoft publishes the Assassin’s Creed game franchise. An earlier version misspelled the name of the franchise.