Acquisitions Key to Square Enix's Expansion

Final Fantasy maker, Square Enix, is set to expand in the next couple of years. So says the company's president, Yoichi Wada.

Speaking in a Bloomberg interview, Wada said, "Acquisitions and alliances will be the cornerstone of our growth strategy this year and the next".

He wasn't more specific about exactly what the company would be acquiring, except to say, "We are an entertainment content provider, so you won't see us buying business software or food and beverage companies.''

So, exactly who was Wada-san having a pop at? Ideas in the Forum please.

The company's last acquisition was of Taito - the creator of Space Invaders - back in 2005. The time has rolled around for Square to get back to empire building, apparently. "The cycle of buying new companies, improving earnings and acquiring again comes on average every two years", said Wada. "It's been two years since we bought Taito. I think it's time for the next round.'

"Our net income ceiling in past few years was between 15 and 20 billion yen, and the next step is to raise it to the 20 billion yen to 25 billion yen range'', Wada said. "Slumping equity markets worldwide make this an opportune time for acquisitions.''

Given that Wada is talking about acquisitions (plural) we'll probably see the company looking at several smaller developers rather than making a single killer purchase.

Despite calling the Wii a toy back in December, Square has already shown its willingness to support Nintendo with (among others) its Final Fantasy titles on the DS (and Nintendo platforms are selling in huge numbers in Japan), so SPOnG would not be surprised to see the company targeting developers with a proven track record on Nintendo hardware.

Furthermore, given its Japanese focus and the fact that it has the RPG market cornered, it will more than likely have a mind to put out casual games.

^{Source: Bloomberg}