The parent company of Elden Ring studio, Kadokawa, has confirmed receiving Sony’s offer for the buyout; however, they haven’t made any decision yet.
On November 19th, Reuters reported that Sony is buying Kadokawa and also taking on the famous Elden Ring game under the company’s subsidiary studios FromSoftware.
The shares of Kadokawa increased rapidly after this report. After that, the CEO of Kadokawa Takeshi Natsuno confirmed the report in a note.
Natsuno acknowledged the articles on acquisition of the company and commented that “this information is not announced by the Company. The Company has received an initial letter of intent to acquire the Company’s shares, but no decision has been made at this time.”
Furthermore, the CEO said if anything official proceeds, the announcement will come through the company in a “timely and appropriate manner”.
At the same time, Sony has chosen to stay silent.
Kadokawa owns 70% of FromSoftware
Kadokawa owns a majority of FromSoftware shares, whereas Sony already owns 14% and Tencent owns 16%. According to IGN, Sony’s interest in the company became more apparent during the year 2022 when it first purchased 14% of the company’s shares.
Sony was aiming to support its media businesses and took interest in cross-media development of various games IP and anime. Since Kadokawa also operates in anime and manga, it made sense that Sony wanted to own a percentage of the company.
However, Sony’s gaming business has suffered notable losses this year due to the closure of various students like Firewalk, the developer of Concord. As a result of this, major layoffs have happened in Sony.
For instance, in February, the company laid off 8% of its PlayStation workforce, roughly equal to 900 staff. This impacted various PlayStation studios like Firesprite, Naughty Dog, Guerrilla, and Insomniac. However, the London studio of PlayStation took the hardest hit.
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