The subsidiary was founded as part of a €1.16 billion deal between Ubisoft and Tencent, and was officially announced back in March

Just a few months after having founded a new subsidiary with Tencent, Ubisoft, in its latest earnings report, has revealed what the focus of the new company will be. In its report (courtesy of WCCFTech), Ubisoft has stated that the subsidiary, backed by Tencent’s expertise, will be focused on “building” ecosystems around some of the major brands under the company, and turning them into billion-Euro franchises.

As part of this initiative, the subsidiary will focus on improving the quality of single-player, narrative driven experiences, expanding on live-service offerings from Ubisoft focusing on frequent content updates and multiplayer, and break into the mobile market, as well as international markets like China.

In the earnings report, Ubisoft also stated that its initiative to reshape the organisation and create the subsidiary alongside Tencent came about as a way to continue on its focus of creating and supporting open-world games as well as live-service titles. The subsidiary was created after a “thorough review of its pipeline” from October to December. This structural reshaping has, according to the report, had a hand in the high quality of Assassin’s Creed Shadows. More details about how this will affect Ubisoft going forward will be revealed later in the year.

“To support this vision, the Company is currently working on reshaping its operating model with the objective to better meet player needs, deliver superior game quality and drive disciplined capital allocation,” wrote the company. “Management targets to announce the new organization by the end of the year.”

As for Ubisoft’s deal with Tencent, the earnings report reiterates the fact that the nature of the deal means that Ubisoft still maintains ownership of its major IPs: Assassin’s Creed, Far Cry and Rainbow Six. As part of the deal, Tencent’s stake in the new subsidiary is valued at an investment of €1.16 billion, which gets it a 25 percent minority interest.

“With this transaction, Tencent will invest €1.16bn in a primary issuance by the New Subsidiary, acquiring an approximate 25% economic interest,” explained the company. “At closing, at least €500m will be upstreamed to Ubisoft, ensuring sufficient working capital needs of the New Subsidiary at start.”

Ubisoft had announced its new subsidiary alongside Tencent back in March. During the announcement, the company emphasised that it would maintain an exclusive, irrevocable and perpetual license over the aforementioned IPs, while Ubisoft as the parent company will continue to get royalties.

“Today Ubisoft is opening a new chapter in its history,” said Ubisoft CEO Yves Guillemot when the subsidiary was first announced. “As we accelerate the company’s transformation, this is a foundational step in changing Ubisoft’s operating model that will enable us to be both agile and ambitious. We are focused on building strong game ecosystems designed to become evergreen, growing high-performing brands and creating new IPs powered by cutting-edge and emerging technologies.

The company’s most recent release was Assassin’s Creed Shadows, which it has described as having “clearly” surpassed its predecessors, Odyssey and Valhalla, in terms of player numbers. The game is available on PC, PS5 and Xbox Series X/S.