Nintendo prepares 'war chest'

Expansion on the cards for Kyoto's finest?

Japanese giant Nintendo has established a special fund to provide for a programme of mergers and acquisitions in the near future, suggesting that the company is planning to accelerate its growth in certain technology sectors.

The news comes courtesy of a report in Japanese business publication Toyo Keizai Shinpousha this week, which doesn't reveal exactly how much money has been set aside, but explains that it is mostly focused on acquiring new technological resources.

Nintendo continues to be one of the most profitable companies in the games industry, and has assets in reserve of around €5.1 billion - so even a very significant spending spree wouldn't make much of a dent in the company's balance sheet.

Late last year, the firm caused a stir on the Japanese stock market when it made an investment in game publisher and media empire Bandai - and although both companies denied that any form of takeover or merger was on the cards, Bandai insiders hinted that a number of senior executives at the company were keen on the concept of strengthening business ties with Nintendo.

However, this new fund is apparently targeted at acquiring technologies which Nintendo currently lacks - which could imply that the firm is planning to bring more of its console hardware development requirements in house, or, perhaps more likely, that it is eyeing innovative software and peripheral makers with a view to acquisition.

Nintendo was stung last year by the launch of Sony's EyeToy peripheral, which was the kind of innovative product that the Kyoto-based firm saw as being more its territory than Sony's. It has since pledged to release a number of innovative game products, of which the Nintendo DS is only the first, and several GameCube peripherals and associated software titles are thought to be planned. It may be to this end that the company now wishes to acquire technology firms.

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