It would make much more sense to buy 5 smaller companies than 1 big one. Usually smaller companies have great new ideas but lack the funding to do great things. A group of ambitious developers in a small company but given Nintendo's funding would make much better games then they would alone.

On the other hand a company like Square would make the same games with or without Nintendo's funding, and it's hard to recover the cost used to buy the company. Rare cost 1 billion dollars, and Square is even bigger.

The idea of buying a huge developer to starve our competition is ridiculous. This is typical thinking of MS's and Sony. Realize you can't buy all the good companies to kill your competion; there will always be more new, smaller companies that are created and are putting out great games for the other systems.

You can never buy them all.

If they can buy 51% of the shares, well that will basically make them 2nd party!

Edit: Buying that huge amount of shares is still a lot of money. They are still better of creating more studios or buying the smaller ones I guess. Just to give you an idea: Sony owned 19% of the shares of Square before they merged with Enix. It's only when they merged that they went multiplatform. Whatever the amount of share Sony has now. It's not enough to prevent them to go multi.