Sony is currently negotiating a potential acquisition of Kadokawa, the prominent Japanese media company known for its development of the acclaimed video game Elden Ring, according to two insiders familiar with the discussions. This move aligns with Sony’s strategy to enhance its entertainment portfolio.
Ongoing negotiations suggest that a formal agreement could be reached within the next few weeks, contingent upon the talks progressing favorably, the sources indicated.
Following the news of the acquisition talks, Kadokawa’s stock surged by 23 percent, hitting the daily trading limit. Before the report was released by Reuters, the company’s market capitalization was estimated at approximately $2.7 billion (around Rs. 22,791 crore).
Representatives from Sony declined to provide comments on the situation, while Kadokawa stated that it is unable to make any remarks regarding the negotiations.
Sony holds a two percent stake in Kadokawa and also has investments in FromSoftware, a subsidiary of Kadokawa and the developer behind the successful fantasy role-playing title.
Elden Ring, a game that has garnered critical acclaim, is the product of collaboration between renowned game director Hidetaka Miyazaki and author George R.R. Martin, creator of the Game of Thrones series. The game has sold an impressive 25 million copies, with its recent expansion, Shadow of the Erdtree, selling five million units within just three days of its launch in June.
Established in 1945 as a publishing house, Kadokawa has since diversified its portfolio, expanding popular franchises like Re:Zero across various media, including games, anime, events, and collectibles.
Other notable franchises under Kadokawa include Delicious in Dungeon, a manga series turned anime that follows adventurers navigating dungeons and consuming the monsters they encounter.
Once recognized primarily as the creator of the Walkman, Sony has evolved into a multifaceted entity that focuses on entertainment and technology, encompassing movies, music, gaming, and semiconductors.
In a previous statement, Sony CEO Kenichiro Yoshida expressed the importance of investing in beloved characters and intellectual properties, noting that these assets can endure for decades. “That’s something we want to make an investment in for sustainable growth,” he remarked.
Sony’s attention has also shifted towards anime, particularly given the genre’s global expansion fueled by the rise of streaming platforms and the growing appreciation of Japanese culture.
The company has effectively adapted its franchises for broader audiences, exemplified by the successful HBO drama adaptation of The Last of Us game series.
With a market valuation of approximately $114 billion (roughly Rs. 9,62,332 crore), Sony faced setbacks earlier this year when it canceled a planned $10 billion (around Rs. 84,415 crore) merger between its Indian division and Zee Entertainment Enterprises, citing unmet conditions.
Kadokawa has faced significant challenges in recent times. The company suffered a cyberattack in June, leading to a data breach that disrupted its business operations.
Additionally, two years prior, Tsuguhiko Kadokawa, the son of the company’s founder, stepped down as chairman following his indictment on bribery charges linked to the Tokyo Olympics.
© Thomson Reuters 2024
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
