A North American & # 39; activist company & # 39; Value investor known as ValueAct Capital Partners LP has raised $ 1 billion in Nintendo, it has been revealed.
According to the last post to its investors, ValueAct began buying stock in April 2019 and grew its position in the Japanese video game giant during the stock market sale in February and March.
However, while most activist investors use equity on the part of the organization to put pressure on its management to take the company to a certain level, ValueAct emphasized that it is on the same footing as Nintendo's management and that the company's future is bright.
It already has "several meetings" with Nintendo's executive team and has a good understanding with current Nintendo president Shuntaro Furukawa. ValueAct adds that there is potential for future growth in the software sector – and there is a chance for Nintendo to turn itself into a broader entertainment recommendation, as Disney did with its new Disney subscription service.
Because of this, ValueAct is currently not pressing for a seat on the Nintendo board, which is what most activists put a lot of emphasis on. Instead, it told its investors, ValueAct will want to give Nintendo a behind-the-scenes guide, providing working experience across the board for companies like Adobe and Microsoft.
ValueAct's move to secure a stake in Nintendo marks the third turning point in Japan for new investment opportunities. A year ago, Rob Hale of RalueAct joined the firm of camera firm Olympus, and a few weeks ago, ValueAct got a 7% stake in the chip and featured architect JSR Corp.
ValueAct told its investors that Nintendo is experiencing a digital transformation that will make the company bigger than ever:
We believe Nintendo will be one of the biggest media services in the world, in the category with the likes of Netflix, Disney +, Tencent Interactive Entertainment and Apple Music.
Such comments echo the sentiments of video game industry analyst Michael Pachter, who recently said that Nintendo should offer its gaming catalog on a subscription-based Apple Music-Apple Music app to open a new revenue stream.
American activist investors are viewed traditionally by some degree of suspicion by Japanese firms, and for good reason. Last year, American company Third Point launched an activist investment campaign against Japanese tech giant Sony, encouraging the company to resell its semiconductor business and dumping shares to Sony Financial.
However, ValueAct said that Nintendo's management has always been "acceptable to those who take the time to understand Nintendo's unique approach," so it seems that right now, there are no plans to force Nintendo's adults to do anything that I'm not comfortable with. Whether the situation will last is something that may not be answered for some years until now.
