Ubisoft bids for Arkane Lyon ahead of Xbox's December sale deadline

Around 217 jobs at Arkane Lyon depend on whether a buyer signs before the French consultation period runs out on 13 December. A sale would likely let the studio finish Marvel's Blade, announced in 2023 and expected within the next one to two years, according to people familiar with the talks.

Bids on the table, no deal

Jason Schreier's Bloomberg report names only Ubisoft. The other suitors stay unidentified. No one disclosed the terms of any offer, and Xbox has not accepted any of them. Nobody has disclosed who would hold the Marvel licence after a sale.

An Xbox spokesperson told Bloomberg the company is exploring options ahead of a December deadline and declined to elaborate. A Ubisoft spokesperson did not immediately comment. Xbox has also weighed selling the studio to its own management, a route that would make Arkane Lyon independent rather than hand it to a rival publisher. It has spun out studios before: Double Fine and Compulsion Games went independent, while Undead Labs entered terms to join new ownership, according to a July memo from Xbox chief executive Asha Sharma. Ninja Theory might still close after two acquisition deals fell through, IGN reported.

The bids followed weeks of speculation that Xbox would shut Arkane down.

Why 217 jobs sit on the deadline

All of them could be eliminated if Xbox shuts the studio down, Shacknews reported. Xbox could sell the studio instead.

French labour law explains why this reads as a sale rather than a shutdown. It requires consultation with the Social and Economic Committee before large-scale layoffs, which is why Arkane's management opened talks with its Works Council over strategic options. Le Monde reported, as relayed by GamingBolt, that the first deadline for finding a buyer was 13 November. Xbox then extended the consultation period by a month, to 13 December, according to Shacknews and eXputer. Xbox's own public reference is only to December. Le Monde quoted a union representative who said the studio was in good financial health and that Blade was near the end of production.

Blade is the asset on the table

Blade is the reason the bids matter. Arkane announced the game in 2023 and has shown only a cinematic trailer, Engadget reported.

The licence is the loose end. Arkane does not own Blade. It licenses the character from Marvel, and nothing public says whether a buyer would inherit that licence. Arkane has announced no release date, platform list or publishing arrangement. It is also unclear what happens to Arkane's own franchises, Dishonored and Deathloop, in a sale, though Xbox has let other divested studios keep theirs.

How Arkane ended up on the block

In July, Xbox chief executive Asha Sharma announced a reset of the gaming business and said the company planned to divest Arkane and four other studios. Her memo set out about 1,600 immediate role eliminations and roughly 3,200 planned across FY27, against the roughly 217 jobs at Arkane Lyon. Xbox handled Arkane differently from the studios named in that memo. Its management began the consultation French law requires.

Arkane was founded in Lyon in 1999. ZeniMax Media bought it in 2010. It arrived at Microsoft with the $7.5 billion ZeniMax acquisition in 2021. Under Bethesda, Arkane Lyon shipped Dishonored 2 in 2016 and Deathloop in 2021. Its sister studio Arkane Austin developed the original Dishonored and 2017's Prey, and shipped 2023's Redfall. Xbox closed it in May 2024.

A buyer that is itself shrinking

Ubisoft's headquarters sit just under 300 miles from Lyon, and the two companies have worked together. Ubisoft published Arkane's 2006 action-RPG Dark Messiah of Might and Magic and still holds the Might and Magic rights.

Ubisoft is shrinking too. It announced layoffs twice in January, then again in March, June and October, Engadget reported. Shacknews reported that the publisher closed studios and laid off hundreds over the course of the year. Some observers doubt it can absorb a studio while it is cutting costs.

Ubisoft has handled a Disney-owned licence before, releasing Star Wars Outlaws in 2024, Kotaku reported. It employs more than 15,000 people.

What happens next

Reports last month suggested Xbox could shut Arkane down without a buyer, but people close to the talks now say a sale is the more likely outcome. Xbox has not named a preferred buyer. Until it does, the names beyond Ubisoft stay open, as do the price and the fate of the Marvel licence.