Units of Tencent and Sony will take minority stakes in FromSoftware, the Japanese developer of hit action role-playing title "Elden Ring," via a third-party allotment of new shares, FromSoftware parent Kadokawa said Wednesday.
Following the transaction, which will raise ¥36.4 billion ($263 million), units of Tencent Holdings and Sony Group will hold 16.25% and 14.09%, respectively, with publishing giant Kadokawa retaining 69.66%.
The multiplatform fantasy title, which is published by Bandai Namco outside of Japan, is a collaboration between veteran game director Hidetaka Miyazaki and "Game of Thrones" author George R. R. Martin. It had sold 16.6 million units worldwide by the end of June.
The transaction is the latest investment in Japan by Chinese gaming giant Tencent and extends spending by entertainment conglomerate Sony as that company looks to shore up its leading industry position in the face of deep-pocketed rivals. Tencent and Sony already have stakes in Kadokawa itself.
"The investment shows that Tencent is still active in expanding their footprint outside China in big ways," said Serkan Toto, founder of the Kantan Games consultancy, describing FromSoftware as a "commercial and creative powerhouse."
The deal could mean Sony's platform gets preferential treatment when it comes to FromSoftware titles, over such rivals as Microsoft's Xbox, although they were unlikely to become PlayStation exclusives, Toto added.