Saudi-Backed investor Electronic Gaming Development Company (EGDC) has decided to increase its stake in Capcom, one of Japan’s most successful video game publishers.
According to a report filed at Japan’s Kanto Local Finance Bureau today, Saudis raised their share of Capcom from 5.03% to 6.04%. The filing reveals that EGDC boosted its holdings from 26.78 million shares to 32.18 million shares, with the reporting obligation dated April 2.
EGDC operates under MiSK Foundation, an entity established by Saudi Crown Prince Mohammed Bin Salman. The firm is widely known as the parent company of SNK. The investment is Capcom is classified as a “pure investment,” meaning the goal is financial returns through capital appreciation and dividends, rather than strategic control over the makers of Resident Evil Requiem.
Despite the ongoing Iran war that has impacted the Saudis, it seems the Saudis have a sustained interest in the video game sector, especially in established video game publishers like Capcom, Ubisoft, and others.
Saudi Arabia has been steadily expanding its presence in the gaming industry as part of broader diversification efforts under its Vision 2030 initiative.
Investment without strategic control is the approach for the time being. However, things can always changed over time as Saudis push more money into the Japanese and Western gaming markets.
According to Marketscreener, EGDC has now invested a total of $617 million in Capcom but Capcom is not the only firm coming for the Japanese gaming market shares.
Ayar First Investment, a Riyadh-based investment firm, also has a share in Capcom, Nintendo, Naxon, and Bandai Namco. Ayar is basically playing a much broader and more aggressive version of the same game EGDC is playing, just at a larger scale and more diversified across Japan’s top publishers.
Unlike EGDC, which is more focused (like its stake in Capcom), Ayar has spread its bets across several of Japan’s biggest gaming companies:
- Capcom (~6.6%)
- Bandai Namco (~5.05%)
- Nexon (~10.7%)
- Koei Tecmo (~9.3%)
Ayar is building a portfolio across Japan’s entire AAA gaming ecosystem. Ayar has a relationship with Saudi Pubic Investment Fund (PIF). The goal seems to be gaining global cultural influence through gaming; similar to films and sports.
Japanese publishers have some of the top IPs in the world. Saudi strategy ties into buying mobile giant Scopely, and large scale acquisition like EA.
Officially, these are all just investments, not takeovers. But there will be a clear influence overtime as shares are increase 1 percentage point at a time. Saudi strategy is to own a slice of the entire Japanese gaming market.
