Konami and Capcom to merge?

Quite possibly, say analysts.

US website Bloomberg has published a report predicting that major Japanese publishers will look to mergers as a means of raising funds and combatting escalating development costs.

The report refers to the recent Namco/Bandai merger and the bid for Taito by Square Enix (itself born out of a previous merger) as evidence of a growing trend.

But not everyone is convinced by the findings - speaking to Bloomberg, Capcom spokesperson Ryosuke Tanaka pointed out that the company has not been involved in any mergers or acquisitions during its entire 20 year history.

Bloomberg is not alone in its predictions, however. A Cosmo Securities analyst has also stated that "Capcom is probably the most likely candidate for acquisition or merger out of the remaining large companies.

"The company is in a difficult situation financially. The most effective of possible combinations for Capcom would be if Sega Sammy bought the company."

Bloomberg also highlighted Konami as a prime candidate for a new merger, and Konami executive officer Michihiro Ishizuka said the possibility is already under consideration.

"Rising costs and falling profit margins will speed up consolidation in the industry," he stated.

"Buying companies with knowhow and infrastructure for online businesses would make a lot of sense for us."

Konami has previously purchased Bomberman developer Hudson Soft, and bought stakes in toy manufacturer Takara and developer Genki. The company also owns Japan's largest fitness gym operator, People Co., and is in the process of rebranding the gyms under the Konami name.

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