Sony’s Plan to Acquire FromSoftware’s Parent Company May Have Hit a Snag

Sony may have hit a speedbump in its supposed plans to acquire FromSoftware parent company Kadokawa, and it has to do with how expensive this purchase would be. Earlier this month, rumors started to spread of Sony looking to buy Kadokawa. Kadokawa has also ventured into other media like anime, which Sony has recently gained a foothold in thanks to its purchases of Crunchyroll and Funimation in recent years.

Sony already has a 2% stock in Kadokawa and 14% in FromSoftware, and FromSoftware-developed titles like Bloodborne and especially Elden Ring have traditionally performed well for PlayStation. Since the rumors of this acquisition first started, there has been speculation among the gaming community about the ramifications it would have for the industry, especially since Kadokawa also owns other studios like RPG Studios, Spike Chunsoft, and Danganronpa developer Aquire.

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If Sony Acquires FromSoftware, It Needs to Seize an Obvious Opportunity Sooner Rather Than Later

As reports emerge about Sony possibly acquiring FromSoftware, it’s worth wondering just how the two companies might function if they do indeed merge.

More recent reports have indicated that Kadokawa would only be interested in a deal with Sony if it is a complete buyout, all anime and gaming assets included. This might prove to be a complication for Sony, at least according to Japanese finance outlet Toyo Keizai (via Automaton). The cost of purchasing all of Kadokawa’s assets would be upwards of 640 billion yen (approximately $4.3 billion), which might be too steep a price for Sony in the wake of its other recent investments like its 2022 buyout of Bungie.

Buying FromSoftware’s Parent Company Might Be Too Expensive for Sony

There is also the possibility that Sony’s hypothetical attempt to buy Kadokawa could trigger a bidding war, which could drive up the price even further. Earlier this year, Sony Group stated that it was planning to allocate 1.8 trillion yen (or roughly $12 trillion) for investments and share repurchases, but this could already be stretched thin due to other purchases like music rights. For example, Sony Music spent around $1.27 billion to acquire Queen’s song library back in June.

If Sony really does want to acquire Kadokawa’s subsidiaries like FromSoftware, it might attempt to do so by buying 15% of the company’s shares to turn it into an equity-method affiliate, or 50% to make it into a subsidiary that it doesn’t fully own. Only time will tell how this all plays out, even as industry insiders and outside observers alike speculate on the long-term impact that Sony purchasing Kadokawa would leave on gaming, anime, and television.

Sony

Date Founded

May 7, 1946

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Minato City, Tokyo, Japan