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Forums - Nintendo Discussion - Can Nintendo Investors make NIntendo acquire a studio?

RolStoppable said:
No, they can't.

Investors didn't succeed with their continuous suggestion of Nintendo should make games for mobile either. The investors' idea was that Nintendo should make Virtual Console available on smart devices, along with new original games that were like Nintendo's handheld games. Nintendo kept insisting that such a move would only hurt Nintendo's core business in the long run, hence why they were not going to do it. While Nintendo did eventually end up making games for smartphones, their approach isn't what investors had asked of them.

The same goes for the internet gaming community who had asked the same of Nintendo as investors. But what Nintendo actually ended up doing is not what people understand as Nintendo going third party, because all the desirable Nintendo content remained exclusively on Nintendo consoles.

Back to the topic of studio acquisitions, Nintendo's standard answer to such inquiries is that there's no sense in buying up a studio when its employees at large wouldn't want to work for Nintendo. If Nintendo bought up such a studio, it would only be a matter of time until the studio bled dry of its original talent because the employees would resign over time. In other words, the part of a studio that Nintendo sees the value in is not the name or reputation of the studio, but the people behind it.

I don't mind nintendo getting some additional IPs, but then again they already ignore many of their own



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mjk45 said:
JWeinCom said:

Well... Nintendo could. It's not like they'd go out of business if they it didn't work out, but taking that big of a gamble would probably make stockholders antsy, and if it didn't work out, there'd be major structural changes at the company. Whereas with Microsoft, they it probably won't even be the most significant thing in the company by a long shot. Sony on the other hand probably couldn't in any realistic sense.

Sony's market cap is I think something like 30 billion above Nintendo's... But that's largely based on predictions for the future.

Sony has a lot more assets than Nintendo does. Like... A LOT. But a lot of that is not in short term assets.

In terms of short term assets (cash or stuff that can become cash quickly), Nintendo has about 15 billion. Sony has about 54 billion.

But while Nintendo is basically debt free, Sony is not. They have about 46 billion in short term liabilities (debt that needs to be paid soonish). 

So... If Nintendo paid 7.5 billion for Bethesda, they'd still just be 7.5 billion dollars poorer. They'd still have enough money to do what they need to do. If Sony did the same, they'd be be left pretty strapped. They'd still be able to pay whatever they needed to in the near term, but they'd only have about 500,000,000 left to launch the PS5, fund development, pay life insurance, and whatever else they do as a company. They wouldn't have much of a cushion to fall back on if something went wrong, and they'd be in debt as a company if it didn't work out, which is generally not a good thing. Especially since Sony's been doing a good job digging themselves out of a hole recently, I don't think they'd do that.

If you don't eat your reserves it comes down to your capacity to borrow, so Sony and Nintendo would be fine plus market cap isn't the be all and end all of a company's worth , the market now tends to downgrade what it sees as conglomerates and they are quite often capped at way less value than what the the sum of their parts and profitability would suggest, that's why Sony now is valued at nearly a third of what it was when  valued at 200 billion, and analysts say that conglomerate stock downgrading is why despite a turn around that has produced record profits over the S200 billion version Sony's market cap isn't being met with the same type of rise that other stocks show.

I didn't say market cap was the be all end all, or really say much about it at all.

Sony may or may not be fine if they spent 7.5 billion. They would have to do so by taking on more long term debt. Right now, their current liabilities exceed their current debts (my numbers before was off). Considering the money they've been making, that's probably fine for now, but if they hit a slump, they would have to borrow some money (or convert some long term assets) to pay their bills. Adding another 7.5 billion of long term debt on top of that could put them in a rough spot, and would leave them at a risk to become insolvent which is not a great spot to be in. 



I doubt it. I could see shareholder's pressuring Nintendo to allow a customized GamePass on Switch (one that only include Microsoft exclusives and not the revolving door of timed GamePass releases). Then everyone gets what they want. Microsoft makes money from subscribers, Nintendo gets a cut of the profits of Gamepass for games they would have never been able to sell anyway (like Halo or Grounded), and Nintendo gamers get to play a ton of new games wherever they want.

I could even see Ultimate including not only Xbox and PC but also Switch. Charge $20 a month or something and you can play the games literally anywhere.

This would be a far bigger get than a major studio acquisition and doesn't have the downside of those studios falling apart down the road like some have mentioned already.



No. So called "Stimulus Goliath" moves are Microsoft's thing, much like how IP moneyhatting is Sony's thing. Nintendo's thing is making their own IP and then having a classy dev work on it and give it a good shine.



Kai_Mao said:
Isn’t there some sort of anti-trust law in Japan that affects any company from buying another?
Nintendo is doing well so far with the Switch.
They’re cultivating new graduates to be part of EPD, Monolith Soft is expanding, etc.
It’ll take months (maybe years) to see all of this come into fruition.
Plus, Nintendo goes by their own philosophy and studios that are under their umbrella (or are closely affiliated with them) are going to follow suit.
If a developer doesn’t follow Nintendo’s philosophies and culture, what use can they be if Nintendo owns them? Not to mention that a developer is just that...a developer. If the people that worked on the IPs are not there..it’s not the same. Didn’t some of the main people at Rare leave said company by the time Microsoft bought them?

There are laws in place that make it difficult (but not impossible) for foreign companies to buy Japanese companies, but I believe that's all. Japanese companies are still regularly bought/sold. Just look at Sega's recent purchase of Atlus as an example.

Last edited by Ka-pi96 - on 22 September 2020

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Nintendo will not buy another studio and they don't have to.
Nintendo has already the biggest first party output of the big three console manufacturers plus Microsoft's decision to acquire Bethesda changes nothing for Nintendo, Bethesda games were never system sellers on Nintendo consols.



I don't see them buying up some AAA publisher like Microsoft just did.

That said, a smaller studio could be in the cards. No publisher since Nintendo seems to largely prefer using it's own IPs to those from bought studios (apart from Bayonetta of course)

With that said, If I had to choose some studio to buy, it would probably be WayForward games, as Shantae, Mighty Switch Force and Vitamin Connection really fit well with Nintendo's own IP in my opinion.



Historically, Nintendo has not been about big acquisitions.  I personally think they need to invest that big pile of cash they are sitting on like a dragon, but they probably aren't going to use it to make a big acquisition like Microsoft just did.  Generally Nintendo seems to like to build their company slowly and carefully.  They gradually train new teams and build relationships with other companies and either invest and/or buy a company that they already have a good relationship with.  For example, right now Koei Tecmo is a decent candidate (or maybe just some of the development teams that fall under Koei Tecmo), because it seems like they have been working closely with Nintendo lately.  Nintendo has also been using their money to simply get other studios to make games using their IP.  But I suppose that is another way to build relationships with other companies.

The way history played out, Nintendo could always afford to build their company slowly and carefully because they've been in video games since almost the beginning.  Sony and Microsoft entered into an already robust market, so they had to aquire development studios just to compete.  Even all of these years later, Sony and Microsoft have to make bigger acquisitions, because they are still significantly behind in first party output compared to Nintendo.



I believe the last time Nintendo attempted to purchase a big publisher is when they supposedly tried to buy Namco in the mid-2000s. It didn't happen and I think the consolation was Monolith Studios. It seems Nintendo has never fully wanted to get away from Namco as they own nearly 4 million shares in the company. It's unlikely they will attempt again as Namco is larger now than 15 years ago. So they last bought a studio in 2007. Nintendo likes to publish exclusive deals with 3rd parties. Work closely with them and let them make a spinoff, remake, or new entry in a long-running IP. Metroid. Zelda and more. Why buy SEGA when they can partner with them on Bayonetta? If SEGA one day cannot partner with them or just says no on Bayonetta..fine they create new IPs with PG like Astral Chain or Wonderful 101. Just as an example,



Bite my shiny metal cockpit!

Won't happen. Nintendo is far too conservative, they are not only an old fashioned Japanese company but they are a Kyoto based company and Kyoto business culture is even more stringent and strict than say Tokyo. They like being a small company employee wise. Makes it easier to micro-manage the company.

If they didn't own Retro outright I think they probably would have dumped Retro too, lol. That studio has been given a lot of chances and come up short in terms of delivering a finished product in an acceptable time frame. 

What Nintendo does do is they're basically using Bandai-Namco and Tecmo-Koei as outsourcing studios.

Last edited by Soundwave - on 22 September 2020