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Founding family of Nintendo sell-off large portion of company stock

The founding family of Nintendo, the Yamauchi family have sold a large portion of their shareholdings. The company (Nintendo) bought back 9.5 million shares, or about 7.4 percent of its outstanding stock, for a cool 114 billion-yen ($1.1 billion).

Nintendo Demo Booth
Photo by Kevork Djansezian/Getty Images

President Satoru Iwata continues to promise company shareholders a return to profitability. Mr. Iwata’s next business strategy is to enter the healthcare market with wearable technology, with a kind of Wii Fit approach. However, this will in all likelihood be of little consolation to investors as the Yamauchi family signal a parting of ways with the company it built over a hundred years ago and the video game industry.

There is also the mention of Mr. Iwata considering a Merger & Acquisition option. This clearly sits well with Microsoft and Sony, who would kill to have Nintendo’s vaunted collection of IP’s running on their machines. Maybe Disney, the international conglomerate have spared no expense in acquiring iconic characters to sit alongside Mickey Mouse. In the last three years Disney has acquired Marvel Inc. and LucasFilms Co., Nintendo would be a logical purchase.

Sales continue to be bleak for the Wii U, only 2.4 million Wii U units were sold in the nine months ended Dec. 31, the company said. Net income declined 77 percent in the third quarter ended Dec. 31 to 9.6 billion yen, according to figures derived from nine-month totals announced Jan. 29. Operating profit fell 6.9 percent to 21.7 billion yen.

One of the few bright spots for the company is that it currently has t $8.6 billion of cash and equivalents and zero debt as of Sept. 30, 2013.