Softbank and GungHo Online Entertainment

Mukesh ValabhjiThe previous blog explained how Softbank is expanding by buying other technology and telecommunications companies in a strategic manner. Mukesh Valabhji endeavours to keep followers informed of the latest business news via his Pinterest page, follow Mukesh to read more.

GungHo Online Entertainment is a Japanese video gaming corporation which hosts the Japanese server of Ragnarok Online. It has also developed Ragnarok DS for the Nintendo DS. Its mobile game Puzzle & Dragons was extremely successful; in 2013, the company made $1.6 billion in revenue, of which 91% was attributed to this game. Since its launch, the game has been downloaded 37 million times.

GungHo’s specialisms are the planning, development and distribution of online computer games, applications for use on smartphones and console games.

Softbank already had a stake of 33.6% in GungHo; it bought another $265 million of stock which increased its stake to 58.5%, making GungHo a subsidiary company. As part of the deal, Softbank also acquired 73,400 shares in Asian Groove.

Softbank and Gungho have previously acted collaboratively; in 2013, they jointly bought a 51% stake in Finnish computer gaming company Supercell in a deal costing them $1.53 billion.

Softbank has set itself the target of becoming the number one mobile network provider in Japan, and wants to reach 1 trillion yen in annual operating profit by March 2017. The acquisition of GungHo is a strategic step towards this goal.