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Happinet Bids for Friendly Takeover of Broccoli as Subsidiary

The toy and entertainment production company Happinet announced on Friday that it is making a bid to acquire more shares of the game and character goods company Broccoli. Broccoli's board of directors also announced the takeover bid on Friday, and recommended that shareholders accept the offer to turn Broccoli into Happinet's wholly owned subsidiary.

The offer would be effective from April 17 to June 13 for 1,500 yen (about US$11.30) a share. (Stock shares of Broccoli closed at 1,026 yen or about US$7.75 on Friday.) The bid's minimum number of shares is 3,231,500, and there is no maximum. The bid price would put Broccoli's value at 9.2 billion yen (about US$69 million).

Happinet is already Broccoli's largest shareholder with 29.72% of shares. The company also signed agreements to acquire the shares of Broccoli's current second and third largest shareholders, Animate (7.77%) and Bushiroad (3.90%).

Through the takeover, the companies aim to make faster decisions for content development, expand development of Broccoli's owned content, expand business through Happinet's management resources, and strengthen management support. The companies would be able to share highly confidential information and would not have to face restrictions on mutual management resources. Happinet and Broccoli have been in a capital and business alliance as independent companies since December 2015.

Bushiroad formed a partnership with Broccoli in November 2020. Bushiroad stated that its reason the partnership was part of its overall mission to "create a new era of entertainment" as an IP developer. Prior to the partnership, Bushiroad purchased 341,100 shares of Broccoli between September to December 2019. Directly after the partnership, Bushiroad held about 3.89% of the company's shares.

Takaaki Kidani founded Broccoli in 1994. Broccoli is known for its media franchises Di Gi Charat, Galaxy Angel, Aquarian Age, Z/X Zillions of enemy X, Uta no Prince Sama, and Kamigami no Asobi, all of which have inspired anime adaptations. The company was also involved in the production for such anime as Pita-Ten, H2O ~Footprints in the Sand~, Psychic Force, and Sister Princess, among others. The company has also produced manga, video games, and card games. Broccoli previously owned the "GAMERS" retail chain in Japan before selling it to Animate in 2011. The company also had retail and publishing operations in the United States through its Broccoli International USA subsidiary, which shut down in 2008.

Broccoli and TIS Creation established a new game brand aimed at female players named LicoBiTs to develop otome romance simulation games.

Happinet was founded in 1969 as a toy wholesale and distribution company, but began expanding its fields of business in the 2000s to also include visual and music software, video games, card games, and other entertainment products. Happinet absorbed BEAM Entertainment in 1999 and the production company changed its name to Happinet Pictures in 2002. Bandai Namco Holdings is the company's largest shareholder.

Sources: Happinet, Animation Business Journal (Tadashi Sudo), Gamebiz