Nintendo’s founding Yamauchi family is reportedly looking to sell its shares in the company, following its poor financial report in January.

http://www.vg247.com/2014/02/03/nintendo-founding-yamauchi-family-looking-to-sell-company-shares-report/

Following the financial report, current Nintendo president Satoru Iwata has vowed to take a 50% pay-cut, along with fellow members of the company board.

Now Bloomberg reports that Nintendo is gearing up to buy-back shares worth ¥114.2 billion / $1.1 billion tomorrow.

Nintendo has stated that the 9.5 million shares are worth ¥12,025 per share, which accounts for 7.4% of the firm’s outstanding stock. The company added that the heirs of late Nintendo president Hiroshi Yamauchi – who passed away back in September – have expressed a, “desire to sell,” their stock, but it is currently unclear how many shares they will release.

Company spokesperson Yasuhiro Minagawa added in a statement, “We are not in a position to know how much shares the Yamauchi family will sell.”

Nintendo Life adds that Nintendo currently has $8.6 billion in the bank and no debt.^

Well.... that´s their decision. It´s something they may or may not regret in the future, but that´s how the stock market works.

I don't get where websites keep pulling this $8.6 billion figure from.

http://www.marketwatch.com/investing/stock/ntdoy/financials/balance-sheet

Cash only - ¥478.76 billion

~ $4.7 billion by my count.  Unless they've made $4 billion somewhere in the past 12 months that I'm not aware of.

Also, they have liabilities.  Pretty much every company does.  In Nintendo's case, they do indeed seem to be very low, though.

Anyway, all this is very interesting since I'm studying business law at the moment.  Buy back of shares, not a bad choice really, especially if they can afford it.

They have $4.7 Billion USD in pure cash, but around another $4 Billion in other liquid assets.  That's where they get it from.  And for all intents and purposes, no they do not have "debt".  Nintendo's liabilities are so small that they could be called mathmatically insignificant.  Nintendo's liabilites are the equivalent of someone making 300k a year, owning their home and car and having a credit card with 2000 owing on it, which they will pay off before the end of the billing cycle.  We would say that that person is "debt free".

I can delete my whole post it's no biggie. :)

Moderated - Kresnik.

I do understand that, but this isn't the first article I've seen saying Nintendo have that much "in the bank", which isn't really true unless they realise the value of their liquid assets, which presumably are acutally being used for other things.  They could start selling their properties as those are assets too but that doesn't mean they have cash in the bank.

Regarding the debts, haven't studied that part of the balance sheet so much.  Looks like you're right, they don't have much in terms of debts from loans or the like; it's all tied up in taxes and such.

It is acceptable for a writer to say they have $8 billion or so in the bank.  The additional assets they are referring to are not things like buildings or other physical assets, but rather things such as cash which has been invested. It is more accurate for the writer to say they have $8 billion than $4 billion, though if they were being technical they could break it down.  But if Nintendo wanted to blow $8 billion to acquire something, or to pay the bills or whatever, they could do so without selling property or borrowing, and they could do it quickly.  Again, to compare to an individual, it's like if you or I had 100k in cash in our checking account and another 100k in an investment account.  We would say we have 200k "in the bank", which is how people (accurately) describe Nintendo's financial situation.

Question then - they can access their short term investments whenever they need to, then?

Like you say, they want to buy a $5 billion investment tomorrow with only their own cash.  The money in "short term investments" can be withdrawn straight away and put into their own bank account to make the purchase?

If so, then never mind.  I did not know that!

Seems to me like Yamauchi's daughter and Mr. Arakawa (her husband) don't have much confidence in Iwata if they're immediately dumping their stock.

Or they could just care less about the family buisness and now that Daddy is gone she's gonna get that boob job, Lambo and diamond plated grill she always wanted.  More likely however, they are just willing to sell back maybe 5% of their massive holdings.