Kadokawa Corporation’s stock surged 19% during early trading in Tokyo on Wednesday, following a Reuters report that Sony is in discussions to acquire the Japanese publishing, anime, and gaming giant. The spike followed a 23% increase on Tuesday when the news initially broke, with shares hitting their daily trading limit. Both Sony and Kadokawa have refrained from commenting on the matter.
Sony’s interest in Kadokawa underscores its strategy to strengthen its entertainment portfolio, which spans gaming, movies, music, and anime. Kadokawa, the parent company of “Elden Ring” developer FromSoftware, brings with it a blend of successful intellectual properties and production capabilities across multiple mediums.
Serkan Toto, founder of Kantan Games consultancy, commented on the potential acquisition, noting Sony’s focus on bolstering its anime and manga offerings. “Anime and manga are conquering the world, and Sony knows this. They need firepower if they want to be a big player in these markets, so they went for Kadokawa,” Toto said.
Sony already owns anime streaming service Crunchyroll and production powerhouse Aniplex, known for hits like Demon Slayer. Analysts believe Kadokawa would complement Sony’s anime operations. “Adding Kadokawa’s anime planning and production capabilities would enhance Aniplex’s offerings,” noted Atul Goyal of Jefferies. He added that Kadokawa’s ability to originate intellectual property through its publishing arm would further bolster Sony’s creative arsenal.
The anime market is projected to grow significantly, with Grand View Research estimating its valuation to nearly double to $60 billion by 2030. The global appeal of Japanese franchises continues to grow, fueled by adaptations like Netflix’s live-action One Piece and Amazon’s forthcoming Yakuza series.
Beyond anime, Kadokawa’s gaming subsidiary FromSoftware is renowned for critically acclaimed titles such as Elden Ring and Sekiro: Shadows Die Twice. These successes position Kadokawa as a valuable asset for Sony, especially as the gaming industry contends with soaring production costs. Sony recently closed two game studios after underwhelming performances, signaling its need for more stable and diversified revenue streams.
Should the deal proceed, analysts believe it could reduce Sony’s reliance on blockbuster hits and provide steadier growth across its entertainment divisions. “The Kadokawa deal would mean less dependence on blockbusters for PlayStation and stabilize Sony’s entertainment business overall,” Toto said.
