Nintendo establishes joint venture company with DeNA

Original (11/8): Nintendo and DeNA are teaming up on a joint venture company titled Nintendo Systems, it’s been announced. This is expected to go into effect on April 3, 2023.

The two sides have been collaborating since 2015. DeNA had been working with Nintendo on some of its earliest mobile efforts, and also provided support when it comes to Nintendo Accounts.

With the new joint venture company, it was mentioned that the goal is “to strengthen the digitalization of Nintendo’s business” and it “will research and develop, as well as create value-added services to further reinforce Nintendo’s relationship with consumers.”

Here’s the full notice:

Nintendo Co., Ltd. (HQ: Kyoto Minami-ku; Representative Director and President: Shuntaro Furukawa; hereinafter “Nintendo”) hereby announces that its Board of Directors has resolved to establish a joint venture company with DeNA Co., Ltd. (HQ: Tokyo Shibuya-ku; President and CEO: Shingo Okamura; hereinafter “DeNA”) at the Board of Directors’ Meeting held on November 8, 2022. Since the amount of capital of the joint venture company is greater than 10% of that of Nintendo, it will become a Specified Subsidiary of Nintendo.

With the integrated hardware-software model at the core of its business, Nintendo also strives to provide enhanced experience and service outside of its dedicated gaming system. In order to provide this experience in a holistic manner, Nintendo is working to maintain and expand its relationship with consumers primarily through Nintendo Account.

As part of this effort, Nintendo entered a business and capital alliance with DeNA in 2015 and has collaborated to develop and operate the new core system centered around Nintendo Account since then.

Based on the expertise accumulated over the seven plus years and the experience of co-developing multiple services based on Nintendo Account, Nintendo and DeNA will advance their partnership and establish a joint venture company. With the objective to strengthen the digitalization of Nintendo’s business, the joint venture company will research and develop, as well as create value-added services to further reinforce Nintendo’s relationship with consumers.

Overview of the Joint Venture Company (Specified Subsidiary)

• Name: Nintendo Systems Co., Ltd.
• Location: Tokyo
• Representative Title and Name: Representative Director and President Tetsuya Sasaki
• Business: Research and development, as well as operations to strengthen the digitalization of Nintendo’s business, in addition to the creation of value-added services.
• Capital: 5 billion yen
• Date of Foundation: April 3, 2023 (scheduled)
• Fiscal Term: Ends in March
• Capital Contribution Ratio:
  • Nintendo Co., Ltd.: 80%
  • DeNA Co., Ltd.: 20%
• Relationship between Nintendo and Nintendo Systems:
  • Capital Relationship: Nintendo Systems will become a subsidiary of Nintendo, which will contribute 80% of the capital.
  • Personnel Relationship: A few officers and employees of Nintendo will concurrently serve as directors of Nintendo Systems.
  • Business Relationship: Nintendo will entrust to Nintendo Systems, the development and operation of services to strengthen the digitalization of Nintendo’s business.

(Note: The establishment of this joint venture company is subject to all necessary approvals, including those required by the competition laws of involved countries.)

Overview of the Joint Venture Partner

• Name: DeNA Co., Ltd.
• Location: 2-24-12 Shibuya, Shibuya-ku, Tokyo
• Representative Title and Name: President & CEO Shingo Okamura
• Business: Game business, live streaming business, sports business, healthcare and medical business, new businesses and others.
• Capital: 10.397 billion yen
• Date of Foundation: March 4, 1999
• Major Shareholders and Shareholding Ratio (as of March 31, 2022):
  • Tomoko Namba: 16.70%
  • The Master Trust Bank of Japan, Ltd. (Trust Account): 14.61%
  • Nintendo Co., Ltd.: 12.72%
  • Custody Bank of Japan, Ltd. (Trust Account): 5.20%
• Relationship between Nintendo and DeNA
  • Capital Relationship: Cross-holdings
  • Personnel Relationship: Not applicable
  • Business Relationship: Nintendo and DeNA jointly develop and operate game apps for smart devices, and Nintendo entrusts DeNA with the joint development and operation of membership services for various devices.
  • Applicability to Related Parties: Not applicable

Schedule

• Date of Resolution by the Board of Directors: November 8, 2022
• Date of Establishment of the Joint Venture Company: April 3, 2023 (scheduled)

(Note: The establishment of this joint venture company is subject to all necessary approvals, including those required by the competition laws of involved countries.)

Future Outlook

The establishment of this joint venture company will have no effect on Nintendo’s results for this fiscal year. The effects it will have on future results will be incorporated into financial forecasts from the next term onwards.

Source

Update (4/3): An official website for Nintendo Systems has now opened. You can find it here.