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Konami Buys 38% of Hudson Soft
Japanese game software maker Konami Corp said on Thursday it will buy a 38 percent stake in Hudson Soft Co for five billion yen ($40.46 million) to try to boost market share by diversifying its products.
The Hudson Soft Co/Konami information release is below;
It is well known that in the consumer-use software industry, the competition among makers is becoming extremely tough these days. Thus, the worldwide realignment of the industry has already started and numerous types of consolidations are taking place. In response to this climate, we aim at the following synergy effects by welcoming HUDSON into the KONAMI group.
The Purpose of the Strategic Capital and Business Alliance between KONAMI and HUDSON
(1) Enhancement of Group Capability
We aim at the enhancement of total group capability and the establishment and further expansion of a firm foundation in the industry through the integration of KONAMI STUDIO Sapporo into HUDSON, mutual utilization of technology and contents, and the joint acquisition of major contents.
(2) Cooperation in the Strategic Business Field
We aim at the synergy effects in the strategic business fields such as On-Line and Mobile game, other strategic business fields than consumer-use game software.
(3) Mutual Utilization of Management Resources and Know-how
HUDSON can utilize not only KONAMI's already developed domestic distribution network but also various development support functions and financial resources. Further, HUDSON can apply KONAMI's management know-how
Concrete Plans of the Strategic Alliance
(1) Integration of KONAMI STUDIO Sapporo into HUDSON / Birth of a Worldwide Studios
With the integration of KONAMI STUDIO Sapporo, HUDSON can enhance its capability and make a remarkable improvement of product line-ups and contents. It is expected that the Hokkaido based world-wide studios will be born in the group, supported by sufficient creative staff and collectively fused know-how.
(2) Mutual Utilization of Software Development Technology
Both KONAMI and HUDSON mutually utilize each technology and develop software efficiently.
(3) Joint Acquisition of Major Contents / Mutual Utilization of Contents
It is becoming more important to acquire the power contents in the industry. Both KONAMI and HUDSON will acquire power contents in cooperation and mutually utilize them in our respective expertise. Further by mutually utilizing KONAMI contents such as baseball, soccer, K-1 and HUDSON's contents, we can provide rich line-ups of products.
(4) Mobile Games
HUDSON is a top-class mobile contents developer in Japan and has stored sufficient know-how for developing next-generation mobile phones, going ahead of other companies. Through the combination of such technical capability of HUDSON and the characters and licenses held by KONAMI, our group will provide unique mobile contents to the world markets. It is also expected that operating costs will be reduced due to the integration of the server.
(5) On-Line Games
It is anticipated that in the near future on-line games will produce a very large market. Realizing the importance of this market, both KONAMI and HUDSON have already taken the business development for the future. With this alliance, we will integrate the contents of the HUDSON site into KONAMI Online and start co-site operations. We aim to make it as the leading on-line game site with better contents in quantity and quality.
(6) Out-Sourcing Development of KONAMI Products to HUDSON (HUDSON RSD Business)
To date, HUDSON has already been entrusted, on a subcontract basis, to develop other brand software in addition to its own brand software, due to its reputation for high level of technical capability. With this alliance, HUDSON will also start to develop KONAMI products. In consequence, this will help KONAMI expand its development capability and strengthen its line-ups and also HUDSON for stable management of operations.
(7) Business Expansion to other Fields
KONAMI has expanded its entertainment business, such as amusement machine and creative products, in addition to the game software business. HUDSON's powerful contents will be utilized in an effective manner in each of these various businesses. Card games are now one of the most important businesses for KONAMI. The same business is conducted by "Miraibachi Karuta Shokai" in HUDSON group. Therefore, we will have a business alliance and seek for synergy effects for the two companies.
(8) Sales of HUDSON Products through KONAMI's Distribution Network
KONAMI established so-called "Major Business" in February of 1999, which handles to buy other company's software and sell them through leading KONAMI distribution network. By handling HUDSON's products by "Major Business", it is expected that efficient and effective distribution of HUDSON's software will be achieved. In addition, we will conduct promotion activities such as jointly-held sales events.
(9) Common Utilization of KONAMI Group Development Support Companies
KONAMI Group has a number of related development support companies such as Konami Computer Entertainment School, Inc. (for the development of talented creative staff), Roppongi Monitoring Center, Inc. (for the quality test services of software) and Konami Software Shanghai, Inc. (for the software development on a subcontract basis). These companies will support HUDSON and strengthen its development capabilities.
(10) Enhancement of Financial Capability by third Party Allotment for Capital Increase
KONAMI will support to strengthen HUDSON's financial capability by third party allotment for capital increase, which will enable HUDSON to take more aggressive management. Based on sufficient investment of capital into development, HUDSON's powerful contents such as Bomber Man, Momotaro Dentetsu and so forth will be recreated.
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