Old Man Yamauchi was their buyout defense, in that he was one of the largest individual shareholders with a lot of influence over others. Since he passed, Nintendo spent a lot buying up many of his shares.

Plus Japanese companies very rarely get bought out in hostile takeovers. That's why you get more partnerships like Square Enix, Bandai Namco, Tecmo Koei.

Why are they so reluctant to Western or foreign partnership/ownership?

I understand that they've been a secluded people since WWII and that affected their culture; however, businesess wise that really doesn't help their situation.

A lot of their once titans in the eletronic market, are not competitive and they're not following Western and Korean innovation. It looks like they lack funds and fresh ideas that abund in the Western market.

Their corporate culture has always been more insular and slow-moving. It has its advantages, because then you get companies with stronger continuity of leadership and a more unified vision for what they want to achieve (unlike, say, Western companies which buy, sell, and swap subsidiaries like they're Monopoly properties), which helped them greatly in the era of "synergy" for instance: Western companies tried to synergize, Japanese companies were already synergized with one company operating in numerous interrelated markets, like Sony's sort-of total-media-control scheme, where they produce video games, computer programs, movies, TV shows, and music, and then produce everything that can run all of this content

The corporate culture left them poorly prepared for globalization, but it endures largely because of a practice called "Share interlocking" which helps hedge many companies against foreign buyouts, as well as government subsidies to keep failing companies on life support, and a far weaker culture of shareholder activism (basically the companies do what they want and damn the shareholders).

Part of the present reforms under Shinzo Abe are trying to open this process up to make it more like other countries, but as with all other things in Japan, true reform is slow to come.

Nintendo, meanwhile, is insular even as Japanese companies are reckoned. Part of it makes sense, because they are still a very small company with few employees (home and abroad only about, what, 5,000 on the payroll?), so they're not managing behemoth empires like Sony or Toyota which would necessitate greater plurality of thought, and Iwata's administration has led to a yet more close-minded corporate culture (not that it hurt them, not until the Wii started to peter out). Them becoming partners with Microsoft is difficult to fathom.

You know that most Xbox players want the return of Rare with their beloved platformers right?

You're a frequent Xbox Empire visitor you know that. I mean Arcade/Indie platformers was a popular thing on Xbox 360 before it was a hipster thing to brag about.

Xbox brand only owns a major FPS ip, Halo. That's it.

If you look at X360 top ten best seller and compare it to PS3's you'll find the latter with more FPSs.

I posted this in other Pacther/Nintendo thread, thought it would be fun to debate on its own merits. Just a hypothetical, for hardcore "console warriors" don't get too upset by it and try to look at things logically, remembering that Nintendo's share of the home console biz is being whittled down to irrelevance and MS has investors who want their game division spun off/sold. So I suggest: 

- Nintendo and MS agree to partner, MS agrees to take a *secondary* role to Nintendo in terms of branding and control. Nintendo gets a 65/35 split of third party licensing revenue and console profit or losses. MS agrees to pay Nintendo a decent sized money hat every year of the agreement and to assist with marketing costs. Nintendo reserves the right to renegotiate/back out of deal after 5-6 years. 

- Satoru Iwata is president of all worldwide gaming divisions under the new alliance. Phil Spencer becomes new head of Nintendo of America and unifies NOA + MS Western studios. Works well since both companies (NOA and MS) are across the street from each other in the Seattle area. Reggie Fils Aime is vice president, Ken Lobb works to transition both sides to work together -- perfect fit as he's worked with both Nintendo and MS in the past. 

- Hardware going forward will be co-branded, with Nintendo as the lead brand. Nintendo and MS assist each other in hardware design/development. 

- Nintendo agrees in return to use Microsoft's online infastructure (XBox Live + MS Cloud) and to use Windows 9 mobile as their OS for the next-gen Nintendo portable, bringing MS' struggling mobile OS to a larger new audience aside from just Windows Phones. A big win for Microsoft here, MS doesn't really need the peanut profits from the game business, but they do need increased marketshare for their mobile Windows, getting kids hooked on Windows mobile over iOS and Android would be a big win for them. For Nintendo it saves them time/money from having to develop their OS and having wide functionality for it. 

- Nintendo + MS jointly launch next-gen 4K capable machine in fall 2017 (one year ahead of Sony) with Mario + Master Chief + lots of third party support, go on to theoretically dominate Sony. Win-win for both sides IMO, Nintendo gets badly needed increase in marketshare (especially in the West), MS gets to keep their toes in the game business while being able to go back to focusing on their main objectives (Cloud/OS/mobile) and lots of new Windows mobile customers. 

That's true, but I don't think Sony would be willing to give Nintendo as much control and a majority share of profits. Game profits don't mean sh*t to MS, they're peanuts for them, but for Nintendo it's their main business so it's a big deal. 

Would Sony be willing to give Nintendo even a 50% cut of their profit from hardware/third party licensing? I doubt it. Sony needs the money from gaming as much as Nintendo does. MS is the only one that really doesn't need that. 

Nintendo needs to get over their xenophobia of the West anyway, there simply is no future for a game company that ignores the Western world when the West in now like 80%+ of the handheld business. This is better than the alternative of eventually (possibly) having to grovel around like Sega or something as a third party pimping Mario out to every platform under the sun if things continue to go bad.