The Saudi Arabia Public Investment Fund has purchased a 5% stake in Nintendo. This purchase, which makes the PIF Nintendo's 5th biggest shareholder, is part of a wider push on the PIF's part to invest further in the worldwide gaming industry.
Why has the PIF bought this Nintendo stake?
Earlier this year, the PIF purchased stakes worth more than 5% in major gaming companies Capcom and Nexon. Now, the PIF is expanding its portfolio even further with a 5% stake in Nintendo, according to Bloomberg (note: article behind paywall). A filing handed over to the Japanese Finance Ministry describes the purchase as being made for "investment purposes", Bloomberg says. The purchase will make the PIF the 5th biggest shareholder in Nintendo according to data gathered by Bloomberg, although the PIF's investment is unlikely to have any serious creative impact on Nintendo.
Toyo Securities analyst Hideki Yasuda told Bloomberg that this investment is part of Saudi Arabia's attempt to "beef up" its own content creation industry. By investing in foreign gaming companies, according to Yasuda, Saudi Arabia can learn how these companies operate and take those lessons back to its own homegrown efforts. A spokesperson for Nintendo said that the studio had learned about the investment "from news reports", according to Bloomberg, providing no further comment.
It's investment and consolidation season in the gaming industry
This is just the latest in a long string of major investments and buyouts in the gaming industry. At the start of 2022, Take-Two acquired mobile giant Zynga, with that $12.7 billion acquisition breaking records for the most expensive gaming buyout at the time. Of course, just over a week later, Microsoft bought Activision Blizzard for a staggering $68.7 billion, shattering Take-Two's record. That's not even mentioning the recent purchase of several Square Enix studios by Embracer Group, or the recent rumors that Sony will purchase Square Enix.
Of course, the PIF's investment in Nintendo isn't on this level, but the fund itself is pretty impressive in terms of value. Backed by Saudi crown prince Mohammed bin Salman, the PIF was established in 1971 and is now a big part of the Saudi Vision 2030 initiative, which aims to diversify the Saudi economy. To that end, bin Salman and the PIF have been on something of a shares spending spree, picking up shares in companies like EA and Take-Two as well as a controlling stake in King of Fighters developer SNK. Although the PIF investment probably won't have too much of an effect on Nintendo's consumer operations, we'll still bring you more on this as soon as we get it.