Nothing in the farming background of the Guillemot brothers, who hail from France’s remote Brittany region, destined them to one day do battle with France’s most feared corporate raider.
However, that was before they conquered the gaming world with titles like Just Dance and action game Assassin’s Creed, attracting the voracious attention of fellow Breton businessman Vincent Bollore, head of the media conglomerate Vivendi SA.
The Guillemot brothers are already 1-0 down against Bollore.
Vivendi earlier this year succeeded with a hostile public offer for shares in Gameloft SA, the developer of games for mobile devices including the Dungeon Hunter and Modern Combat series, that was founded by Michel Guillemot.
And now Bollore also wants Ubisoft SA, the prized jewel in the Guillemot crown.
He has already taken nearly 23 percent in the company that is led by Yves Guillemot.
That sounded the alarm among the tight-knit and discreet brothers, who own just 13 percent of Ubisoft’s shares with 19 percent of the voting rights.
Moreover, Bollore will soon benefit from a new regulation in France that gives long-term shareholders double voting rights, to have 27.5 percent of votes.
Vivendi’s pledge in June that it would not launch a hostile public offer for Ubisoft over the next six months did little to calm their worries, as Bollore has made no secret of his desire to unite Gameloft and Ubisoft.
Concerned that Vivendi’s next step might be a push to get its representatives on Ubisoft’s board of directors, the Guillemot brothers circled the wagons ahead of an Ubisoft shareholders’ meeting at the end of last month, causing Vivendi to back off.
However, Vivendi later said in a statement it “considers that it would be good corporate governance for it to be represented on the company’s board of directors considering its level of equity interest.”
“Vivendi’s statement should feed the fear of management to a creeping takeover by the media group,” brokerage Gilbert Dupont said in a client note.
Vivendi also blocked measures at the meeting that would have the given the board the right to distribute free shares or offer share options to managers or employees, which would have allowed the Guillemot brothers to cheaply strengthen their control over Ubisoft.
Yves Guillemot said after the meeting they had “won an important battle for the company,” but not the war.
Gilbert Dupont said it considered a public offer unlikely at this point, given the opposition voiced by employees at the shareholder meeting to the prospect of a Vivendi takeover.
Another broker, who asked not to be named, noted that a public takeover would require an additional outlay of 3 billion euros (US$3.36 billion), and that given its debt levels, Vivendi might not want to fork out the cash.
The Guillemot brothers launched Ubisoft in 1986, scoring a breakout success in 1995 with Rayman, featuring the limbless humanoid known to throw his floating appendages at his enemies, on the first PlayStation console.
It quickly emerged as a major firm in the industry, generating 1.4 billion euros in annual sales and employing 11,000 people across 20 countries.
The brothers, who sit on the board of directors, hold equal shares in Ubisoft and other family-held companies.
They speak each week in sometimes stormy conference calls, and gather regularly for trips on the family yacht anchored in the Brittany port of Trinite-sur-Mer.
“The Guillemots are a clan of discreet visionaries,” said Laurent Michaud, an expert at technology consultancy Idate. “They take risks with small teams on projects off beaten paths.”
The brothers have successfully defended Ubisoft against a hostile takeover attempt before, seeing off the giant US game developer Electronic Arts Inc in 2004.
However, with Bollore, they have an experienced corporate raider and in Vivendi a media company with interests in film and TV that could gain additional value from Ubisoft’s game franchises.
Ubisoft has, in fact, been moving in this direction itself. Its movie unit, Ubisoft Motion Pictures, is releasing its first full-length feature film, Assassin’s Creed, in December.
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