Sony's parent company, FromSoftware, confirms its interest in buying it out

Kadokawa Corporation, the parent company of FromSoftware, has confirmed that Sony is interested in acquiring it.

Reuters and Nikkei reported the proposed acquisition yesterday, each citing separate sources that a deal was being worked on. Kadokawa acknowledged the reports today, saying that although no formal announcement had been made about a potential buyout, "the company received an initial letter to acquire the company’s shares."

Kadokawa said that "no decisions have been made at this point," but given the way these things work, the receipt a letter indicates that the process has advanced. The initial chitchat and wheeling and dealing is over, and everybody is more or less ready to move forward. The acquisition could be stopped by a regulatory body (although, given what happened with Microsoft and Activision Blizzard, my confidence in government agencies' ability to control large companies is not at its highest). But, aside from that, this deal is very likely to go through.

Sony would make a great acquisition by acquiring Kadokawa. FromSoft is the crown jewel but Kadokawa is involved in many things, including anime and manga production and publication. It also owns Danganronpa Studio Spike Chunsoft, through its Dwango sub-division. Kadokawa's latest earnings report showed that it made more money from its "publication/IP Creation" operations (books and manga, etc.) and animation/film, than gaming. Sony has been demonstrating a clear desire to own more of this space in recent years. After acquiring Funimation and Crunchyroll, respectively in 2017 and 2021. Sony considered buying Infocom, Japan's largest comic book platform, but a private equity firm won the bid.

The downsides of media consolidation are obvious. It's a scourge on the land. But I think that at this point, the best that we can realistically expect is that Kadokawa employees will come out better than those who were left behind by Microsoft or Embracer. I'm not sure how confident I am in this right now.