Sony might just be planning to purchase Square Enix

With deals like Microsoft attempting to acquire Activision Blizzard, Sony acquiring Bungie, Take-Two acquiring Zynga, and most recently, Embracer Group acquiring Square Enix's internal Western studios (Crystal Dynamics, Eidos Montréal,…

By Nivedita Bangari

May 3, 2022

3 min read

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With deals like Microsoft attempting to acquire Activision Blizzard, Sony acquiring Bungie, Take-Two acquiring Zynga, and most recently, Embracer Group acquiring Square Enix’s internal Western studios (Crystal Dynamics, Eidos Montréal, Square Enix Montréal), consolidation in the games industry is at an all-time high.

According to the same firms, the trend of consolidation is far from ended. Sony Interactive Entertainment president and CEO Jim Ryan revealed the Japanese company’s plans to purchase more game production companies in early April, following the unveiling of the PlayStation Plus overhaul.

The critical success and the commercial success of the first-party games that we’ve been making have permitted us to invest heavily into content creation. We’re growing our studios organically and we’re growing through acquisition. We acquired five studios in 2021. We’re in discussions with Bungie. And we have more plans.

Rumors are floating around of Sony going for a big acquisition soon

During the same week, journalists Jeff Grubb and Greg Miller speculated that Sony was planning a large acquisition rather than a smaller one like Jade Raymond’s Haven Studios or PC porting outfit Nixxes.

Following the announcement that Square Enix was selling off its internal Western studios yesterday, Grubb has now revealed that the speculated large deal was Sony buying Square Enix. Of course, he also noted that such speculations are always speculative at best, given the dangerous nature of exposing such large deals ahead of time. There’s also the possibility of negotiations falling through at the last minute.

Much then, if Sony was already planning to buy Square Enix, a slimmer Square Enix might be even more tempting. It would make sense for the Japanese business to continue investing in timed exclusive arrangements with PlayStation, such as those for Final Fantasy VII Remake and Forspoken.

OK. I've said this a thousand times, but there's always someone who is hearing it for the first time: We never really hear enough to report on acquisitions with any certainty. Sony acquiring Square was the big rumor. But I CANNOT confirm that. And I continue to not know. pic.twitter.com/5ZKJruszCE
— Grubb (@JeffGrubb) May 3, 2022

Even if Sony buys Square Enix, that doesn’t imply all of its games will be confined to PlayStation platforms; for one thing, Sony is investing more in the PC market, and they’ve also agreed to keep current and future Bungie games multiplatform.

Square Enix is currently trading at +2.27 percent. It has a market worth of $4.864 billion, which is more than enough to cover Sony’s $10 billion cash reserve for acquisitions. It would be a U-turn for Sony in any case, given the corporation formerly possessed an 18.6% stake in Square Enix before selling all of its shares in April 2014.