Kadokawa Conglomerate in Sony Talks for Potential Deal

Sony is reportedly in talks to acquire the Japanese conglomerate Kadokawa Corporation, as the gaming giant strives to expand and "to add to its entertainment portfolio." Read on to learn more about this ongoing acquisition and what this would mean.

Sony Might Acquire Elden Ring And Dragon Quest Media Powerhouse

Expanding To Other Forms Of Media

Tech giant Sony is reportedly in early acquisition talks with major Japanese conglomerate Kadokawa Corporation, in a bid to "add to its entertainment portfolio." At present, Sony already has a 2% stake in Kadokawa itself and another 14.09% stake in Kadokawa-controlled studio FromSoftware, famous for its critically acclaimed soulslike fantasy action RPG, Elden Ring.

Acquiring Kadokawa Corporation would benefit Sony greatly, as the conglomerate owns several subsidiaries including FromSoftware (Elden Ring, Armored Core), Spike Chunsoft (Dragon Quest, Pokémon Mystery Dungeon), and Acquire (Octopath Traveler, Mario & Luigi: Brothership). Additionally, outside of the gaming sphere, the Kadokawa Group is well-known for being composed of several media production companies that delve into producing anime and publishing books and manga.

With that said, acquisition would definitely achieve Sony’s goal in the entertainment sector, expanding its reaches to other forms of media. As noted by Reuters, "Sony Group hopes to gain the rights to works and content through acquisitions, making its profit structure less dependent on hit titles." If all goes well and a deal is agreed upon, it may be signed by the end of 2024. However, Sony and Kadokawa declined to comment about the current state of affairs as of writing.

Kadokawa Share Price Dramatically Increases, But Fans Are Concerned

In response to the news, share price for Kadokawa have reached an all time high, closing in at 23% at their daily limit. The price reached 4,439 JPY from a 3,032 JPY price point before Reuters broke the news. Sony’s shares have also advanced up 2.86%, following the announcement.

However, netizen reception to the news has been lukewarm, with many expressing their concern about Sony and its recent acquisitions that have seen less-than-promising futures. The most recent example would be the sudden shutdown of Firewalk Studios, purchased by Sony back in the middle of 2023, only to meet an untimely end just a mere year after its acquisition after the negative response to its multiplayer shooter game Concord. Even with an award-winning IP like Elden Ring, fans are worried that the Sony acquisition will affect FromSoftware and its output.

Others are viewing it from the anime and media side of things, where a tech giant like Sony would now have a monopoly over the distribution of anime in the West should the deal push through. Sony now owns popular anime streaming site Crunchyroll, and gaining access to an impressive repertoire of popular IPs like Oshi no Ko, Re:Zero, and Delicious in Dungeon would strengthen its hold in the anime industry as well.