Kadokawa, Japan’s ‘Elden Ring’ powerhouse, faces battle over CEO at shareholder meeting
The logo of Kadokawa is displayed at the company’s office in Tokyo, Japan, June 23, 2026. Picture taken with a mobile phone. REUTERS/Miho Uranaka
Read a summary of this article on FAST.
Get bite-sized news via a new
cards interface. Give it a try.
Click here to return to FAST
Tap here to return to FAST
FAST
TOKYO, June 23 : Kadokawa, the Japanese firm behind the dark epic “Elden Ring” video game franchise, is now facing a nightmare of its own: an activist shareholder who wants its CEO gone, wielding a big stake and proxy advisor support.
The showdown will take place at Wednesday’s annual general meeting and is being closely watched by investors in Japan, where activist shareholders have scored some significant wins as authorities pile pressure on companies to improve returns and corporate governance.
In one camp, there is Takeshi Natsuno, 61 and chief executive since 2021 but under attack for declining profitability.
He may have history on his side after garnering 90 per cent of shareholder support at last year’s AGM. Natsuno has also been backed by the company’s board, which says removing him would create uncertainty while the company is trying to carry out reforms.
Guess Word
Crack the word, one row at a time
Buzzword
Create words using the given letters
Mini Sudoku
Tiny puzzle, mighty brain teaser
Mini Crossword
Small grid, big challenge
Word Search
Spot as many words as you can
Natsuno is facing off against Hong Kong-based Oasis Management, one of the most active activist investors in Japan. Oasis, which says it has been engaging with Kadokawa since 2020, is now the firm’s largest shareholder with a 13.76 per cent stake.
NATSUNO ACCUSED OF ‘PROFIT LEAKAGE’
While “Elden Ring” — a collaboration between veteran game director Hidetaka Miyazaki and “Game of Thrones” author George R. R. Martin — has been a massive success, Natsuno has been criticised for failing to capitalise on it.
The 2022 action role-playing game is published by Kadokawa unit FromSoftware in Japan but by Bandai Namco overseas. That arrangement has led to “material profit leakage,” says Oasis.
Oasis is not alone in thinking it is time for a new person at the helm.
“While it may take time to find a replacement for Natsuno, this is a challenge worth accepting,” Institutional Shareholder Services said in its proxy report.
Glass Lewis, another major proxy advisor, also recommends shareholders vote against the company’s re-election proposal and in favour of the Oasis proposal, the activist said. Glass Lewis did not reply to a Reuters request for its report.
Though a drop in shareholder support from 90 per cent to below 50 per cent would be extraordinary, some market participants say it could happen given the firm’s poor performance.
Kadokawa, a major force in manga, anime as well as video games, logged return on equity of just 0.5 per cent last year compared to 9.4 per cent in the year ended March 2022. In May, it reported annual operating profit that undershot its forecast despite an earlier downward revision.
“Even without Oasis submitting a shareholder proposal, it has become a situation where institutional investors could easily make a no vote,” said one market participant who was not authorised to speak to media and declined to be identified.
And even if Natsuno retains his job, a sharp drop in support could increase pressure for changes sought by Oasis including more investment in big-name titles.
PROBLEM AFTER PROBLEM
Kadokawa has also been plagued with a raft of problems in recent years, including a data leak due to a ransomware attack and an admonishment from the Fair Trade Commission over its treatment of freelancers.
Former chairman Tsuguhiko Kadokawa was convicted of Olympics-related corruption and given a suspended sentence. He is appealing and said last week he was bringing a lawsuit against Natsuno, seeking damages after Kadokawa released a report which the former chairman’s lawyer says affects the case.
Back in 2024, investors had big hopes for change at Kadokawa after it began talks with Sony, but the entertainment giant ended up taking only a 10 per cent stake. Sony declined to comment on how it might vote on Wednesday.
Japanese companies are fielding a record number of activist proposals at this year’s AGMs with proposals opposing company-nominated directors’ appointments or nominating new candidates up almost threefold compared to 2024.
Another highly watched vote will be at Kyocera on Thursday. Oasis, which has argued for the electronics manufacturer to divest unprofitable businesses, is now calling for Chairman Goro Yamaguchi’s resignation.
Source: Reuters
Sign up for our newsletters
Get the CNA app
Stay updated with notifications for breaking news and our best stories
Get WhatsApp alerts
Join our channel for the top reads for the day on your preferred chat app
Get bite-sized news via a new
cards interface. Give it a try.
Click here to return to FAST
Tap here to return to FAST
FAST
About The Author
