Under the third-party allotment, Sixjoy Hong Kong will own 16.25% of FromSoftware’s shares and Sony Interactive Entertainment will own 14.09%. Kadokawa Corporation remains the company’s largest shareholder with a 69.66% stake.
Get the full press release below.
1. Purpose and reason for the third-party allotment
Kadokawa Group’s basic strategy is to stably create intellectual property (IP) consisting of a diverse portfolio of content, centered on publishing, video, games, web services, and education businesses. is up. In addition to expanding this IP globally, we aim to achieve sustainable growth and increase corporate value from a medium- to long-term perspective by further utilizing technology. From Software, a leader in the game business, Sekiro: Shadows die twice When elden ringLeveraging its advanced game IP development capabilities, the Group considers further expansion of the game business, and recognizes that strengthening the creativity, development and deployment of game IP is one of the most important issues. Based on this policy, FromSoftware has decided to procure funds through a third-party allotment to its planned allottees, Six Joy and SIE, for the following reasons.
In 2016, Tencent invested in Guangzhou Astronomical Kadokawa Animation Co., Ltd., a consolidated subsidiary of the Company, and the two companies have jointly promoted a media mix strategy targeting the Chinese market. In October 2021, the Company, Six Joy, and Tencent Japan signed a capital and business alliance agreement to strengthen their strategic alliance in the anime and game fields. Tencent and its subsidiaries and affiliates (“Tencent Group”) is a global Internet group that provides communication, social, gaming, digital content, advertising, fintech and cloud services, and is a leading communication company in the Internet industry. and operates social platforms. in China.
Sony and its subsidiaries (hereinafter referred to as “Sony Group”) and the Company have built cooperative relationships in a wide range of fields related to the Sony Group’s global DTC (Direct-to-Consumer) business, branded hardware business and game business. . In February 2021, we will strengthen our long-term relationship with the Sony Group, create new IP of our company, and maximize the use of existing IP in animation. Implemented a capital increase. and game field.
Through the implementation of this funding, From Software aims to actively invest in the development of more powerful in-house game IP in order to strengthen its development capabilities, and expand the scope of its own publishing in a rapidly growing market. We aim to establish a system that can expand global market. In addition to these objectives, FromSoftware will make a third-party allotment to Six Joy within the Tencent Group, which has strengths in development capabilities, with the aim of increasing the number of users in the global market for game IP created and developed by FromSoftware. Decided to raise capital. An SIE that develops and deploys network technology such as mobile games in the global market, including China, and an SIE within the Sony Group that can simultaneously and independently develop IP development for various media such as games and video in the global market.
2. Overview of third-party allotment
- Repayment period: From September 7, 2022 to September 12, 2022
- Number of new shares to be issued: 3,179 shares of common stock
- Issue price: ¥11,450,000 per share
- Capital to be acquired: 36,399,550,000 yen
- Methods of Recruitment or Allocation (Subscribers): Third-party allotment (Sixjoy 1,703 shares, SIE 1,476 shares)
- Shareholding ratio after issuance:
- Kadokawa Co., Ltd.: 69.66%
- Exclusive to Six Joy Hong Kong: 16.25%
- Sony Interactive Entertainment Inc.: 14.09%
(Note) Payment for the third-party allotment of shares scheduled for September 7, 2022 may be made on a different date, even within the above payment period, due to international remittance procedures, etc.
3. Use of capital (Total paid-in capital: 36,399,550,000 yen)
- Specific use of funds:
- To strengthen FromSoftware’s ability to create and develop game IP.
- Established a framework to expand the scope of FromSoftware’s in-house publishing in the global market.
4. Overview of subsidiary subject to capital increase
- Title: From Software Co., Ltd.
- position: 2-26-2 Sasazuka, Shibuya-ku, Tokyo
- Position/Representative Name: Hidetaka Miyazaki, President and Representative Director
- Business description:
- Planning, development and sales of game software.
- Planning and development of Internet content.
- capital: 268.5 million yen
- Date of establishment: November 1, 1986
- Major shareholders and shareholding ratio:
- Relationship between the listed company and the company:
- Capital relationship The Company owns 100% of the issued shares.
- Personnel relationship Two officers of the Company are seconded to the company.
- Business relationship The Company and the relevant company have a business relationship.
5. Subscriber Overview
- Title: Exclusive to Six Joy Hong Kong
- position: 29/F., Three Pacific Places, No. 1 Queen’s Road East, Wanchai, Hong Kong
- Position/Representative Name: Wang Zheng, Director. Ai Shimin, Director. Byun Jong Won Elizabeth, Director. Tse Cheuk Yin Tiffany, Director
- Business description: Mobile Game Licensing and Publishing.
- capital: 1,000 HKD
- Date of establishment: February 28, 2011
- Major shareholders and shareholding ratio:
- Tencent Holdings Limited:
- Relationship between the listed company and the company:
- Capital ties:
- The company holds 9,724,400 shares of the Company’s stock (Note 1) (6.86% of voting rights held).
- Personal relationship:
- Business relationship:
- The Company and the Tencent Group have maintained a strategic partnership in the publishing business through a joint venture in Guangzhou, China since 2016, and the Company, Tencent Japan, and Six Joy signed a business alliance agreement on October 29. did. , 2021, to strengthen strategic alliances in the animation business.
- Capital ties:
(Note 1): This item is based on the major shareholder report submitted by Sixjoy on November 16, 2021.
(Note 2): In the stock subscription agreement concluded between the Company and FromSoftware with SixJoy, the Company and FromSoftware are not anti-social forces and have no relationship with anti-social forces. I have received it. We also commissioned JP Research & Consulting, Inc.
(Address: 3-7-12 Toranomon, Minato-ku, Tokyo; representative: Keisuke Furuno, CEO) to conduct an investigation. The report they produced states that there is no evidence that Sixjoy is involved with anti-social forces. Based on the above, the Company has determined that Six Joy, Tencent, their officers and major shareholders have no relationship with anti-social forces.
- Title: Sony Interactive Entertainment Inc.
- position: 1-7-1 Konan, Minato-ku, Tokyo
- Position/Representative Name: Representative Director and President Jim Ryan
- Business description:
- Planning, development, and sales of PlayStation hardware, software, content, and network services.
- Planning, development and sales of “toio”, software and contents.
- capital: 110 million yen
- Date of establishment: April 1, 2010
- Major shareholders and shareholding ratio:
- Relationship between the listed company and the company:
- Capital ties:
- Sony, the parent company of the company, holds 2,844,950 shares of the Company (percentage of voting rights held: 2.01%) (as of March 31, 2022).
- Personal relationship:
- Business relationship:
- The Company conducts business with Sony and its affiliates, including the purchase and sale of finished products and services.
- Capital ties:
(Note) In the share subscription agreement concluded between the Company and FromSoftware, SIE states that the Company and its officers are not anti-social forces and that there is no relationship with anti-social forces with respect to this share subscription agreement. has received representations and warranties from SIE’s parent company, Sony, is listed on the Tokyo Stock Exchange. In the Corporate Governance Report submitted by Sony to the Tokyo Stock Exchange on July 5, 2022, basic matters related to the elimination of anti-social forces and the establishment of a system for that purpose were mentioned as matters related to the internal control system. After confirming the stance, we have determined that Sony and its officers have no connection with anti-social forces.
6. Schedule for third-party allotment
- Resolutions of FromSoftware’s Board of Directors and Shareholders’ Meeting: August 31, 2022
- Date of execution of share subscription agreement for third-party allotment: August 31, 2022
- Repayment period: From September 7, 2022 to September 12, 2022
(Note) Payment for this third-party allotment is scheduled for September 7, 2022.
7. Future prospects
The Company believes that the third-party allotment will contribute to improving the medium- to long-term corporate value of the Group, and that the third-party allotment will contribute to the Company’s consolidated performance for the fiscal year ending March 31, 2023. I’m here. As of this report, it is expected to be minor. If disclosure of information is necessary, we will promptly provide the information.