Key Takeaways
- Saudi Arabia‘s Savvy Games Group reduced its Nintendo stake by 0.74 points.
- In doing so, the group is estimated to have netted over $100 million.
- SGG suggested it was considering increasing its stake in Nintendo mere days before the news of it doing the opposite emerged.
As a seasoned investor with a penchant for following the twists and turns of global market trends, I must admit that I was quite taken aback by Saudi Arabia’s recent decision to reduce its stake in Nintendo. Just when we thought they were gearing up for a bigger investment, they’ve decided to cash out instead.
Saudi Arabia sold off a portion of its shares in Nintendo, generating an estimated revenue exceeding $100 million. This unexpected decision caught the attention of many market observers, especially since there were previous reports suggesting that the Public Investment Fund (PIF) was contemplating further investments in Nintendo.
In May 2022, PIF initially purchased a 5.01% stake in the Japanese gaming giant by acquiring outstanding shares through Savvy Games Group, a subsidiary based in Riyadh focused on gaming industry ventures. Since then, this Saudi Arabian entity has further increased its ownership of Nintendo on three additional occasions, with its latest increase occurring early in 2023, bringing its share up to 8.26%.
PIF Reduces Nintendo Stake Back to February 2023 Levels
As a dedicated Nintendo fan, I can share that after nearly a year and half, our subsidiary, Savvy Games, has adjusted its strategy with Nintendo. According to recent reports from CNBC, backed by Japanese regulatory filings, our stake in the gaming giant has been reduced to 7.54%. This move brings us back to the level of investment we had in February 2023, effectively undoing most of our latest investments. Despite this change, it’s worth noting that Saudi Arabia remains one of Nintendo’s significant shareholders post this decision.
Saudi Arabia Made Over $100 Million From Its Nintendo Stock Sale
If Savvy Games reduced its ownership of Nintendo shares by 0.72 percentage points from 8.26% to 7.54%, this equates to around 8,382,448 shares being sold. Given that the highest price Savvy Games paid for these shares was in February 2023, holding onto 0.72% of Nintendo stock over a period of 20 months could potentially have yielded up to $127 million. However, due to the gradual sale of these shares instead of selling them all at once, which might have impacted their price, Savvy Games likely earned slightly less than this amount in reality.
Saudi Arabia’s Nintendo Investment History
| Period | Nintendo Stake |
|---|---|
| May 2022 | 5.01% |
| January 2023 | 6.07% |
| February 2023 | 7.08% |
| February 2023 | 8.26% |
| October 2024 | 7.54% |
Unexpectedly, the sale transpired, a development that came as a surprise given the recent news about Saudi Arabia potentially expanding its Nintendo investment. More precisely, Prince Faisal bin Bandar bin Sultan Al-Saud, vice chairman of Savvy Games, shared with Kyodo News that his company was receptive to increasing its Nintendo shareholding if its partners chose to do so.
Nintendo stock rose by 4.4% on the news of Kyodo’s October 7 report, then fell by 2% on the following day. The PIF’s decision to reduce its investment only became public knowledge after the Tokyo Stock Exchange closed on October 8, so it’s possible that the shares will resume their decline once it reopens. There are currently no indications that this move signals Saudi Arabia is reconsidering its massive commitment to gaming industry investments.
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2024-10-09 16:53