March 27 (Reuters) - French videogame maker Ubisoft UBIP.PA said on Thursday it has set up a subsidiary in which China's Tencent 0700.HK will invest 1.16 billion euros ($1.25 billion).

The new subsidiary, valued at about 4 billion euros, will bring together the Assassin's Creed, Far Cry and Tom Clancy's Rainbow Six brands, the group said in a statement. The move is expected to be completed before the end of 2025, it added.

Ubisoft's shares rose in mid-March after Bloomberg News reported the videogame maker was seeking investors for a new entity, with Tencent among the invited bidders.

The new subsidiary would include the teams developing the Tom Clancy’s Rainbow Six, Assassin’s Creed and Far Cry franchises based in the Canadian cities of Montréal, Quebec, Sherbrooke and Saguenay, and in Barcelona and Sofia, as well as the back-catalog and any new games currently under development or to be developed.

"With the creation of a dedicated subsidiary that will spearhead development for three of our largest franchises and the onboarding of Tencent as a minority investor, we are crystalizing the value of our assets, strengthening our balance sheet, and creating the best conditions for these franchises’ long-term growth and success", Ubisoft CEO Yves Guillemot said in a statement.

"As we accelerate the company’s transformation, this is a foundational step in changing Ubisoft’s operating model that will enable us to be both agile and ambitious", he added.

Guillemot said the company is committed to building a sharper, more focused organization--one where talented teams will take brands to the next level, accelerate the growth of emerging franchises, and lead innovation in next-generation technologies and services.

"We see the immense potential for these franchises to evolve into long-term evergreen game platforms and create engaging new experiences for gamers", Tencent President Martin Lau said in a statement.

($1 = 0.9254 euros)