TOKYO—An American mutual-fund company has become the
largest shareholder in Nintendo Co., placing a growing bet on signs
of a revival in the Japanese videogame company's fortunes, a
regulatory filing shows.
Capital Research & Management, the investment adviser to the
American Funds family, owned a 16.4% stake in Nintendo as of this
week, according to a filing with Japan's Finance Ministry. That was
up from 15.3% in early March.
A surge of foreign investment has driven the Nikkei Stock
Average to near its highest levels in 15 years, and Nintendo has
been one of the biggest beneficiaries of late. Since February its
shares have risen more than 80%.
While Nintendo's Wii U videogame console has struggled to
compete against Sony Corp.'s PlayStation 4 and Microsoft Corp.'s
Xbox One, investors are enthusiastic about recent moves to extend
the company's classic franchises, such as the "Super Mario Bros."
game series, into new areas.
Nintendo said in March that it agreed to develop games for
smartphones with a Japanese partner, DeNA Co., dropping its
long-standing opposition to licensing games for mobile use. It
followed that up this month with a deal to create "immersive
experiences" featuring Nintendo characters at Universal Studios
theme parks.
Also this month, Nintendo reported its first annual operating
profit in four years, helped by strong sales of game-compatible
Amiibo figurines.
Capital Research & Management is one of several prominent
U.S. asset managers that have recently disclosed large stakes in
Japanese companies. Third Point LLC, a New York-based hedge fund,
acquired a stake in Sony in 2013 and sold it last year. More
recently it invested in Fanuc Corp., a Japanese maker of industrial
robots.
While Third Point is known for its activist stance, Capital
Research & Management is a quieter investor. The company said
in the filing that the purpose of the investment in Nintendo was to
generate "profits for customers in and outside of Japan."
Write to Eric Pfanner at eric.pfanner@wsj.com
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