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.
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.
San
Francisco-based ValueAct said it has had several meetings with members of
Nintendo management and that it believes in the vision the company's chief
executive, Shuntaro Furukawa, has shared with ValueAct and with others.
Unlike other
investment firms that push for change publicly and often ask for board seats at
target companies, ValueAct prefers to work with management behind the scenes.
