Game-maker Ubisoft fends off Vivendi takeover, for now

Ubisoft (Euronext Paris: UBI-FR) won a key battle Thursday at its annual shareholders meeting in its ongoing fight with Vivendi (Euronext Paris: VIV-FR) for control of the company — but the war is far from over.

The French video game publisher had worried that the media conglomerate, which has regularly been buying shares in the company this year, would try to insert people onto its board of directors at the meeting. However, Vivendi opted not to do so, allowing Ubisoft to fill the two openings with members of its choosing. CEO Yves Guillemot and his brother Gerard, CEO of Ubisoft Motion Pictures, also saw their board seats renewed.

"Today during our Annual General Meeting, Ubisoft shareholders expressed massive support for Ubisoft's strategy and management," said the company in a statement. "We remain focused on the execution of our strategic roadmap, which has already proven successful and which we are confident will continue to deliver great results and value for all of Ubisoft's stakeholders."

Vivendi, which has been pushing for board representation since April, proposed no resolutions at the meeting, said a spokesperson. Nor did any representatives for the company speak during the Q&A period. And because Vivendi abstained from voting on resolutions related to employee stock grants and options, said a Ubisoft representative, those resolutions failed to pass.

But that doesn't mean the tensions between the two companies are easing. In fact, this could be just the beginning.

Vivendi has already out-maneuvered the Guillemot brothers for control of Gameloft, a mobile game studio, which it acquired via a hostile takeover in June. And Ubisoft officials remain concerned Vivendi head Vincent Bolloré might be considering that same approach for the larger company. (Vivendi now holds a 22.8 percent stake of Ubisoft but said on July 18 that it would not consider a full takeover bid for at least six months.)

To proactively combat a potential bid (and shore up support), Ubisoft has held several meetings over the past year with its top investors to lay out its earnings projections and make the case for current leadership. Last week, the Guillemot brothers bought 3.6 million shares from Bpifrance — representing 3.2 percent of the company's share capital — for $137.7 million. And it has expanded an employee stock purchase program that has raised the employee ownership in the company from 2 percent to 4 percent of outstanding shares.

The company has also been quite public in saying it would sell itself to a competitor before acquiescing to Vivendi control.

"We have Plan A and Plan B," Yves Guillemot told CNBC.com in June. "Plan A is to remain independent. Plan B is going with another group, either in the game industry or with a technology or other types of company. Those are the two options at this point and they are both still open."

Vivendi sold its 85 percent stake in Activision-Blizzard (ATVI) in July 2013 for over $8 billion to reduce debt. Last October, though, it showed strong interest in returning to the gaming world, quickly buying up shares of Gameloft and Ubisoft over the objection of company officials.

By adding these game studios, Vivendi hopes to become an even bigger force in the European media world. Guillemot, though, has steadfastly insisted the two companies are incompatible — and if Ubisoft management were to lose decision-making control about partnerships, it would hurt the company.

Correction: An earlier version of this story misstated Vivendi's ownership stake.