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Ubisoft announces shares buy-back program
- Thread starter dex3108
- Start date
CrashPrime
Member
I am a financial world idiot. Is this good or bad for Ubisoft?
Linkstrikesback
Member
Ubisoft not going quietly in to the Vivendi.
I am a financial world idiot. Is this good or bad for Ubisoft?
A lot of companies do this to raise the value of their stock. For example, EA and Apple do this frequently as an alternative to paying a dividend.
Ubisoft is also doing it in part due to Vivendi.
2blackcats
Member
Interesting.
So if they cancel the bought back shares are they increasing the value and power of the remaining shares?
So if they cancel the bought back shares are they increasing the value and power of the remaining shares?
I am a financial world idiot. Is this good or bad for Ubisoft?
Neither good or bad. Just means that all shares purchased back by them won't be purchasable by Vinvendi. And as mention by Nirolak, it raises the value of their stock.
Some Nobody
Junior Member
Can I assume this has something to do with them trying to keep Vivendi from taking over? I could be stupid, but just at a cursory glance I feel like it does.
ElBoxyBrown
Banned
Whatever happens, Guillemot better write a book on this whole ordeal.
Yes but on the other hand Vivendi can't buy any that ubisoft buys and it raises share value so it's probably worthwhile.Wait, if they cancel the shares they buy back, wouldn't Vivendi's percentage of owned shares increase (because there are less total shares)?
Agent Icebeezy
Welcome beautful toddler, Madison Elizabeth, to the horde!
I am a financial world idiot. Is this good or bad for Ubisoft?
You buy back stocks to create a floor for your stock to your satisfaction, raise of earnings per share or stop takeovers because someone has over 50% of common stock and then your company becomes a subsidiary. Three main reasons.
D
Deleted member 80556
Unconfirmed Member
Yeah acquiring Ubisoft afterwards will seem more expensive and hopefully too much of a hassle for Vivendi.Yes but on the other hand Vivendi can't buy any that ubisoft buys and it raises share value so it's probably worthwhile.
Agent Icebeezy
Welcome beautful toddler, Madison Elizabeth, to the horde!
Wait, if they cancel the shares they buy back, wouldn't Vivendi's percentage of owned shares increase (because there are less total shares)?
In theory, yes but vivendi's stock may be callable in that ubi has the right, not the obligation to purchase stocks back at a specific time at a specific price.
This has been hostile takeover 101 so far. Nothing special.Whatever happens, Guillemot better write a book on this whole ordeal.
Yes but on the other hand Vivendi can't buy any that ubisoft buys and it raises share value so it's probably worthwhile.
Yeah acquiring Ubisoft afterwards will seem more expensive and hopefully too much of a hassle for Vivendi.
In theory, yes but vivendi's stock may be callable in that ubi has the right, not the obligation to purchase stocks back at a specific time at a specific price.
I see, thank you!
chaosblade
Unconfirmed Member
Can someone ELI5?
If Vivendi buys enough of Ubisoft's stock they basically own the company. Ubisoft is buying their own company stock so Vivendi can't.
Apparently, Vivendi's stake in Ubisoft will increase automatically in November because of some 'provision.'
That would mean that Vivendi would be even closer to 30% - the percent point that French law requires they put a bid on Ubisoft.
If this buy-back program is in effect between October 5, 2017, and December 29, 2017 - does it mean that Ubisoft put a serious halt on Vivendi?
Edit: TY for the explanation chaosblade.
That would mean that Vivendi would be even closer to 30% - the percent point that French law requires they put a bid on Ubisoft.
If this buy-back program is in effect between October 5, 2017, and December 29, 2017 - does it mean that Ubisoft put a serious halt on Vivendi?
Edit: TY for the explanation chaosblade.
The provision grants double voting rights to shares registered for more than two years. It applies to 11% of Vivendi's total stake (26.2%) which would bump their voting rights over the required 30% threshold.Apparently, Vivendi's stake in Ubisoft will increase automatically in November because of some 'provision.'
That would mean that Vivendi would be even closer to 30% - the percent point that French law requires they put a bid on Ubisoft.
Vivendi can launch a hostile takeover bid as soon as November 20th.
The provision grants double voting rights to shares registered for more than two years. It applies to 11% of Vivendi's total stake (26.2%) which would bump their voting rights over the required 30% threshold.
Vivendi can launch a hostile takeover bid as soon as November 20th.
I think I heard that French laws actually would force them to launch a hostile takeover bid as soon as they get to the famous 30%.
The mandatory bid is indeed triggered when crossing the 30% threshold.I think I heard that French laws actually would force them to launch a hostile takeover bid as soon as they get to the famous 30%.
Vivendi can stop (or delay) that process by selling or converting some of their existing shares into bearer shares.
If they go for a hostile takeover and it fails, their voting rights drop below 30% and they won't be able to acquire any new shares.
Neither good or bad. Just means that all shares purchased back by them won't be purchasable by Vinvendi. And as mention by Nirolak, it raises the value of their stock.
It's a better than the alternative thing. They get to buy back the stock while simultaneously raising the value, making any shares that Vivendi tries to purchase more expensive. Of course it's Vivendi so it won't make much of a difference. More of a speed bump than a road block.