After much talk of an acquisition, Sony and FromSoftware parent Kadokawa announce “strategic alliance”

There have been rumors for some time that Sony was going to buy Kadokawa Corporation, a monolithic Japanese media conglomerate that will mean nothing to most of you unless I add the magic words “parent company” Dark souls developers FromSoftware” and possibly also “Spike’s parent company Chunsoft”. Sony and Kadokawa were they were reported to be in talks last monthfueling all sorts of speculation about, say, a PC version Bloody they are ritually sacrificed to consecrate Dark Souls 4’s PS6 exclusivity. Now the pair have emerged from the Bargaining Cave and announced… a “strategic capital and business alliance agreement.” What does it mean? Is it safe to scream yet?

Under the terms of the deal, Sony will acquire 12,054,100 new Kadokawa shares for a total value of 50 billion yen by January 7, 2025. Combined with the Kadokawa shares they already own, this will make them Kadokawa’s largest shareholder, owning about 10% of Kadokawa shares overall. So it’s not really an acquisition. But it does give them a say in Kadokawa’s direction.

Kadokawa and Sony have collaborated on projects in the past. The agreement paves the way for further cooperation. According to announcement releasefuture teams could include “potential joint investments in content areas, joint discovery of new creators, and joint promotion of further media mixes of both companies’ intellectual property.” Specifically, they are considering “initiatives to adapt Kadokawa’s intellectual property into live-action films and television dramas around the world, co-produce anime works, expand the global distribution of Kadokawa’s anime works through Sony Group, further expand the publishing of Kadokawa’s games, and develop human resources for promotion and expanding virtual production.”

In short, they’re going to adapt and sell each other’s stuff around the world, which could include any number of games, but could also refer primarily to non-game works, especially anime. I’m a little puzzled by the phrase “develop human resources to promote and expand virtual manufacturing.” As I understand it, virtual production on set is when you use LED panels as a backdrop while making a movie or TV show, allowing the CG to appear in real time. However, it is unclear to me whether this is what the press release means.

Kadokawa CEO Takeshi Natsuno is delighted with the agreement. “This alliance is expected to not only further strengthen our IP creation capabilities, but also expand IP media capabilities through Sony’s support for global expansion, allowing us to deliver our IP to more users around the world,” he noted, slapping it across the board. his hips and the sparkle in his eyes.

Sony Group Chief Operating Officer and Chief Financial Officer Hiroki Totoki is also pleased. “By combining Kadokawa’s extensive IP and IP creation ecosystem with Sony’s strengths, which have fueled the global expansion of a wide range of entertainment including anime and games, we plan to work closely together to implement Kadokawa’s ‘Global Media Mix’ strategy.” is focused on maximizing the value of its intellectual property and Sony’s long-term Creative Entertainment Vision,” he enthused. Is it safe to scream now?

I can’t speak to Kadokawa’s or Sony’s recent approach to such things as we’re more focused on events in North America and Europebut the cancellation of the merger appears to be good news for sustainability in the short term, as none of the Kadokawa or Sony developers will lose their jobs due to post-acquisition “due diligence” i.e. cost cutting. As of August, Kadokawa had 26 games in development.