Sony confirms intent to acquire From Software parent company

Sony has always had a close relationship with From Software and soon, it looks like the company will own the studio outright. Sony has sent a letter of intent to acquire massive Japanese conglomerate, Kadokawa. 

Kadokawa is not a small company. While the headline here mentions From Software, Kadokawa is far more than a games publisher, with lots of film, animation and book publishing companies under its wing. Overall, Kadokawa owns a 70 percent stake in From Software, with Sony owning just under 15 percent. Acquiring Kadokawa would give Sony full control of the game studio.

In a statement, Kadokawa confirmed that it has been in talks with Sony about a merger: “There are some articles on the acquisition of KADOKAWA Corporation (hereinafter “the Company”) by Sony Group Inc. However, 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.”

Sony also confirmed that it sent a letter of intent over the acquisition in a statement to Yahoo Japan: “It is true that we have expressed our initial intentions. We would appreciate it if you would refrain from commenting further.”

Essentially, what this means is that Sony has put its offer forward, in legal writing, and now, the board of directors needs to analyse the offer and see if it is in the best interest of shareholders. Some veteran Kadokawa employees are already expressing their eagerness to see the deal go through, although big mergers like this typically do come with lay-offs.

We also learned recently that this isn't the first time that Sony has discussed a merger with Kadokawa. However, Sony's lack of interest in some of Kadokawa's subsidiaries meant that negotiations did not go further in previous years. Kadokawa executives would prefer that the entire company be purchased outright, rather than having to split up assets.

KitGuru Says: From Software could become the first studio in history to win two GOTY awards at The Game Awards thanks to Elden Ring getting another nomination this year. It would be tough for Sony to not consider making future From Software titles exclusive to PlayStation if the acquisition goes through. With that said, From Software is a small piece of the puzzle here. Sony is likely to get more mileage out of Kadokawa's anime and manga properties, which would give Sony an even tighter grip in this industry, having also purchased Funimation and Crunchyroll. 

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