Nintendo could become the next Disney – if investors get their way
Games, movies, theme parks and beyond
It’s one of the top gaming companies in the world, but could Nintendo one day be among the top entertainment companies too, in the same vein as Disney?
That’s the hope of one of its new investors, according to a report from Reuters. Investment firm ValueAct Capital Partners now owns a 2 percent stake in Nintendo, worth $1.1 billion, after acquiring 2.6 million additional shares in the company.
ValueAct is what’s known as an “activist investor” – rather than seeking a seat on Nintendo’s board of directors, it looks to influence the direction of the company indirectly to improve the return on investment from its partners.
Its goal? To make Nintendo push beyond its video-gaming safe zone of consoles like the Nintendo Switch.
Taking on the titans
Where Nintendo’s competition is now primarily seen as being Sony’s PlayStation division and Microsoft’s Xbox, ValueAct would have Nintendo diversify so that it’s seen instead as “one of the largest digital media services in the world, in a category with the likes of Netflix, Disney+, Tencent Interactive Entertainment and Apple Music.”
ValueAct has had several meetings with Nintendo management, and Nintendo confirms it has been “engaged in dialogue” with ValueAct – a not unusual, but certainly not always engaged in practice between an investor and a business. With such a considerable stake, it is to be expected here.
Nintendo has recently been looking to expand its offering beyond games and its merchandise licensing concern. As well as a partnership seeing LEGO make Mario themed kits, Nintendo is developing a Super Mario movie with the team behind the Minions franchise, and is opening a theme park zone at Universal Studios.
It’s a shift in direction that the late, great Nintendo president Satoru Iwata anticipated. Back in 2014, he said:
“A lot of people around the world think Nintendo is solely a company that makes video games, and I believe more and more of our own employees have started thinking in this way.
“Some employees in charge of development find themselves in positions where all they are thinking about is how they can make the game in front of them more fun, so I don’t think it can be helped if others outside of our company see us the same way.
“So even though we won’t change the fact that our focus is on video games, I felt the need to take that occasion to state that Nintendo is a company that can do whatever it wants.”
It now seems Nintendo has investors that share Iwata’s vision.