Reuters reported Tuesday that Sony is in talks to buy Japanese media company Kadokawa, which is the majority owner of Elden Ring developer FromSoftware. Kadokawa also has significant holdings in the anime and manga industries.
Reuters said a deal could be signed in the coming weeks. Kadokawa’s market capitalization stood at $2.7 billion before Reuters made its report — less than Sony paid for Destiny developer Bungie in 2022.
For gamers, the most eye-catching element of the deal is certainly FromSoftware, of which Kadokawa owns a 70% stake. Sony’s gaming arm already owns another 14% of the studio, with the rest owned by a Tencent subsidiary. Other video game developers owned by the group include Spike Chunsoft (Danganronpa, Dragon Ball: Sparking! Zero) and Acquire (Octopath Traveler, Mario & Luigi: Brothership).
If the deal goes through, it would give Sony near-total control of one of the world’s top game developers. Under Hidetaka Miyazaki, who serves as both FromSoftware’s president and the creative lead on most of its games, the studio has risen steadily in stature over the past 15 years. During that time it created and dominated the Soulslike genre and released a string of acclaimed games including the Dark Souls series, Sekiro: Shadows Die Twice, and Elden Ring, which has sold 25 million copies.
Sony has history with FromSoft; it published the original Demon’s Souls and 2015’s Bloodborne as PlayStation exclusives. That doesn’t necessarily mean that future FromSoftware games will become PlayStation exclusives if the deal goes through, however. Sony has allowed Bungie to stay multiplatform, for instance — and in any case, the platform-exclusive publishing model is falling out of favor in the industry.
But Kadokawa’s holdings extend far beyond FromSoftware, and Sony may have other motivations for the acquisition. Kadokawa is a dominant manga publisher and a major player in anime; it owns properties like Re:Zero and Delicious in Dungeon. Sony Pictures acquired anime streaming service Crunchyroll in 2021, making it a dominant anime distributor outside of Japan. Buying Kadokawa would be a major step toward consolidation of the anime industry as it explodes in global popularity.
It’s likely that Kadokawa’s publishing might, its huge range of intellectual properties, and its clout in the anime industry are Sony’s main motivators in pursuing this acquisition. But the chance to add FromSoftware, one of the most lauded game developers in the world, to its collection is surely one hell of a sweetener.