ValueAct eyes stake of over $1.1 billion in Japanese gaming major Nintendo
Activist investor ValueAct Capital Partners LP has built a stake
of over $1.1 billion in Nintendo, according to a letter seen by Reuters, a bet
that digital software distribution and the development of new entertainment
products will fuel growth at the Japanese gaming company.
ValueAct,
which first began buying the stock in April 2019, grew the position in
Nintendo, known for its gaming consoles and
for having turned characters like Mario and Donkey Kong into international
hits, during the stock market sell-off in February and March, according to the
letter sent to its investors.
Nintendo's
future is bright, ValueAct wrote in its letter, adding there is potential for
growth both in the software business and room for the company to transform
itself into a broader entertainment company.
ValueAct
has picked up about 2.6 million shares, or about a 2% stake, in Nintendo. Shares of
the Japanese company rose more than 2% as trading started in Tokyo.
"We
are aware that ValueAct is holding a stake and we've been engaged in dialogue
with them. We don't disclose content of our dialogue with our investors,"
a Nintendo spokesman
said.
A
spokesman for ValueAct declined to comment.
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