European media giant Vivendi is selling its stake in Ubisoft Entertainment for € 2 billion (US$2.45 billion) to a group of investors including Chinese technology titan Tencent Holdings, ending a potential takeover battle for the French video games publisher. Billionaire Vincent Bollore’s Vivendi, which had been raising its holding in Ubisoft, has agreed to sell its 27.3 per cent stake in the company, best known for its Assassin’s Creed and South Park games. Hong Kong-listed Tencent, which operates the world’s largest games business by revenue, is investing almost € 370 million for a five per cent stake, while the Ontario Teachers’ Pension Plan is spending € 250 million for a 3.4 per cent stake. Ubisoft and Tencent will also form a strategic partnership to boost the French company’s reach into China, the world’s largest video games market with estimated sales of US$32.5 billion last year, according to data from gaming consultancy Newzoo. Asia’s richest man sees advertising, social media driving growth amid addiction debate The move represents a strategic setback for Bollore and Vivendi, which has pledged to make video gaming one of its key pillars along with advertising, music and pay-television. As part of the deal Vivendi has committed to not acquire any further shares in Ubisoft for five years. Vivendi’s stakebuilding since 2015 had prompted Ubisoft’s founding Guillemot family to court Canadian investors to fend off any hostile takeover. After the sale, Vivendi will remain active in video gaming through its acquisition of mobile game maker Gameloft, which was also founded by a Guillemot brother but is much smaller than Ubisoft, the French leader in this market. Along with the investments from Tencent and Ontario Teachers, the deal also includes a share buy-back by Ubisoft that adds up to an 8.1 per cent stake, as well as a share purchase by Guillemot Brothers and an accelerated book building with institutional investors. Former Chinese online games market leader gets investment from Tencent Ubisoft said Vivendi had approached it several weeks ago about its intention eventually to sell its stake. Ubisoft started tapping up potential investors at that stage. Tencent, Asia’s biggest listed company with a market value of around US$540 billion, is investing heavily to expand its gaming empire at home and abroad. It launched some of its top games overseas last year, and last month invested 3 billion yuan (US$474.7 million) in Chinese peer Shanda Games. The Shenzhen-based firm, publisher of blockbuster mobile game Honour of Kings , runs businesses that stretch from social media to online payment. It announced a strong fourth quarter profit on Wednesday, but said mobile gaming revenue growth had slowed.