Ubisoft To Spin Off Unit to Handle Its Hit Gaming Franchises

French video game publisher Ubisoft CEO Yves Guillemot said that his company will carve out a unit that includes the hit franchises Assassin’s Creed, Far Cry, and Tom Clancy’s Rainbow Six into a subsidiary worth about $4.3 billion, Andrew Nusca reported for Fortune’s Data Sheet.

Star Wars Outlaws failed to impress last year, while Assassin’s Creed Shadows was delayed twice before its launch a week ago. I Image: Ubisoft Facebook

China’s Tencent, which holds a 10% stake in Ubisoft and was reported in October to be exploring a buyout of the company, will acquire a 25% stake in the new entity for about $1.25 billion.

This deal will provide Ubisoft with a fresh injection of cash to pay down debts and increase its valuation.

“We will be able to firmly take back control of our future and regain the serenity needed to create the best games,” Guillemot said in a company memo, adding that the changes will put the company back on track toward “a higher level of profitability.”

It has been a challenging period for Ubisoft, whose Star Wars Outlaws failed to impress last year, while Assassin’s Creed Shadows was delayed twice before its launch a week ago.

The company’s revenues have been declining, and its debt-to-EBITDA ratio is substantial, pushing its stock price to record lows.

Ubisoft had been exploring strategic options since January and hinted in the latest announcement that it had multiple suitors leading up to this deal. The transaction is expected to close by the end of the year.