Kadokawa Games has acquired an 80% stake in growing development studio From Software, purchasing the studio directly from previous owner e-commerce powerhouse Trans Commerce. With the deal closing May 21, Kadokawa plans on making From Software its core development studio with plans to grow the business. While Kadokawa has done work in both publishing and development itself, the acquisition of From Software is sure to mark the company as a player to watch in Japan's gaming industry.
From Software is well known for its Dark Souls titles in North America, but in Japan it's more popular for the Armored Core franchise which is extremely successful. While the studio currently has no announced in-development games it's likely that whatever they have in the works, in tandem with the success of both Dark Souls II and Armored Core: Verdict Day, contributed greatly to Kadokaw's acquisition efforts.
There's another angle from this acquisition that deserves further consideration. Kadokawa Games has up to this point avoided releasing their titles, both published and developed in-house, in North America. That is, they have until they released their first-party title Demon Gaze in North America just last week -- with the help of localization company NIS America. From Software up to this point has had a rather tight publishing partnership with Namco Bandai for world-wide releases. Perhaps Kadokawa's searching for larger publishing presence beyond Japan, or perhaps the opposite and westward publishing for From Software titles will suffer.
Hopefully more details about Kadokawa Games' acquisition of From Software will become clear as the deal approaches its closure on May 21. Until then, the entire thing seems a rather curious event. Japan's gaming industry seems more interested in expanding towards mobile development, so why is Kadokawa investing in a console developer that makes games for the core gaming audience?