India, March 28 -- Prominent video game maker Ubisoft Entertainment announced that it will be creating a new subsidiary for its Assassin's Creed, Far Cry and Tom Clancy's Rainbow Six games with an enterprise value of about €4 billion ($4.3 billion).

Tencent Holdings Ltd. will invest €1.16 billion to acquire a 25 per cent stake in this new entity, which will hold the licenses for the intellectual property of the games in exchange for a royalty, according to a Bloomberg report.

As a result, Ubisoft's US shares rose as much as 20 per cent. The closing price on the Nasdaq was $15.79, which is an uptick of 9.39 per cent or $1.355.

"This is a foundational step in changing Ubisoft's operating model that will enable us to be both a...