Nintendo Has Initiated A Share Buyback (To Protect From A Hostile Takeover?)

Nintendo has announced they’re buying back their shares from their stockholders, and we think we know why.

Nintendo just published a press release explaining their action. They are purchasing 14,000,000 shares, valued at over ¥ 100 billion, from Nomura, the Bank of Kyoto, DeNA, and Resona Bank.

They provided this explanation:

The Company has resolved to repurchase its own shares with the aim of mitigating the impacts of the secondary offering on the supply and demand for the Company’s shares, as well as improving capital efficiency, and as part of its capital policy with agility, in response to changes in the business environment, and shareholder returns.

While most fans reacted that it doesn’t really affect them, Redditor Ordinary_Duder put forward a serious theory. They believe that Nintendo is protecting itself from a potential hostile takeover.

As we have explained in 2024, Japan has changed their rules and laws to make hostile takeovers of Japanese companies possible. More recently, Square Enix seems to be targeted by for a takeover themselves.

Nintendo did declare they have systems in place to deter hostile takeovers in 2019. This could be that very action.