On October 29, Chinese multi-tech conglomerate holding company Tencent acquisition a 6.86% stake in Japanese publishing house Kadokawa for 30 billion yen 264 million US dollars (roughly Rs.1976 crore), Kadokawa announced officially on their website. After the deal closes, Kadokawa will become Tencent’s third-largest shareholder.

Chinese-based Tencent subsidiary firm Sixjoy a mobile game publishing company acquires 4.86 million shares for 6,170 (roughly Rs.4,062) yen per share, Kadokawa said in a stock exchange filing agreement. The Japanese based publication house Kadokawa publishes merely 5000 to 6000 books per year- lining up from novels to comic books, well known for its masterpiece animation “Kimi no Na wa” also known as “Your name” in English, the company also runs a video sharing website named “Niconico” or “Nikoniko.”

Niconico ranked at 34 for the most-visited website in Japan, according to Alexa Internet. The firm said it had made a  “strategic alliance”  agreement with Tencent Group to promote the firms, IP-based Global Media Mix, and form a capital alliance with Tencent Group. The company also said the capital would be used for making games and anime series. Judging the reports from various foreign media, Kadokawa will invest the entire proceeds in business by March 2024, including securing editors and producers. 

“Kadokawa and Tencent Groups maintained a strategic partnership in the publishing business through a joint venture company in Guangzhou, China since 2016. In addition, the Company, Sixjoy, and Tencent Japan entered into this business alliance agreement on October 29, 2021, intending to form an expanded strategic alliance in the animation and game business,” reads Kadokawa’s official agreement document. 

In addition, in March of this year, Tencent invested 65.7 billion yen in Chinese-based electronic commerce company Rakuten; this move indicates the plan of actions from Tencent and explains the endeavors put forth by Tencent to grow its business and investment scrapbook in Japan.

Tencent’s stock price has dribbled down about 15% this year following the strict face regulations put forth by the Chinese government on investment policy. Tencent’s 6.86% stake acquisition at Kadokawa is considered a hefty bounty so far, so good for Tencent.

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