In Paris at 09:38 GMT, Ubisoft shares were up 8.63% at 14.04 euros.
The video game manufacturer said on Thursday that the subsidiary, which will bring together the Assassin's Creed, Far Cry and Tom Clancy's Rainbow Six brands, is valued at a "pre-money" enterprise value of 4 billion euros.
"This transaction underlines the strong undervaluation of the group, which could begin to slim down the rest of its business", write Midcap analysts in a note.
"This cash injection significantly eases the Group's balance sheet picture, with net debt almost halved", the broker also noted.
Morningstar analysts point out that "Ubisoft gains in financial flexibility with the cash injection, which is equivalent to around two-thirds of the company's market capitalization prior to the announcement."
According to Barclays analysts' estimates, of Tencent's 1.16 billion euro investment, "520 million euros are available to Ubisoft to repay its debts."
In financial difficulties, Ubisoft last week released the latest opus in its successful Assassin's Creed series, whose strong performance helped the stock to recover somewhat after losing more than 40% of its value last year.
(Written by Etienne Breban, with contributions from Johan Bodinier and Alessandro Parodi; edited by Blandine Hénault)
