Nintendo (NTDOY) authorizes share buyback to offset secondary offering, sales by DeNA and banks

Nintendo is set to buy back over one percent of the outstanding shares of the company in this multi-level transaction.

by · Shacknews

Nintendo has announced a secondary offering of shares related to the unwinding of so-called "cross-shareholding" arrangements with four companies. The Nomura Trust and Banking Co., Ltd, Bank of Kyoto Ltd., Resona Bank, Limited, and DeNa Co. Ltd will all participate in the sale of shares. The Big N has also announced a share buyback in the interest of offsetting the impact of these divestitures.

As was reported earlier this evening, this move comes in response to regulatory pressure in Japan to unwind these intertwined shareholder relationships between financial institutions and companies. 

Here are some details from the Notice of Secondary Offering of Shares press release:

  • 32,697,900 shares of common stock to be offered

  • Sellers

    • Nomura will offer 16,149,900 shares
    • Bank of Kyoto will offer 10,000,000 shares
    • DeNA will offer 6,000,000 shares
    • Resona Bank will offer 548,000 shares
  • The selling price will be determined on a day in the period from Monday, March 9, 2026 to Thursday, March 12, 2026 (the “Pricing Date”) in accordance with the method set forth in Article 25 of the Regulations Concerning Underwriting, etc. of Securities by the Japan Securities Dealers Association, based on the preliminary pricing terms calculated by multiplying the closing price in ordinary market transactions of the shares of common stock of the Company on the Tokyo Stock Exchange, Inc. on the Pricing Date (or, if no closing price is quoted, the closing price of the immediately preceding date) by a number between 0.90 and 1.00 (with any fraction less than one yen being rounded down), taking into account market demand.
  • The offering will be a secondary offering by way of purchase and subscription of the aggregate number of shares by the underwriters. The aggregate amount of the difference between (i) the selling price and (ii) the amount to be paid to the sellers by the underwriters in the secondary offering shall constitute proceeds to the underwriters.
  • Delivery date will be the fifth business day immediately following the Pricing Date

  • Nintendo has authorized the sale of up to 4,904,600 shares (secondary offering by way of over-allotment)

    • The selling price will be determined on the Pricing Date; however, such selling price will be the same as the selling price of the Secondary Offering by way of Purchase and Subscription by the Underwriters.
    • Taking into account market demand regarding the Secondary Offering by way of Purchase and Subscription by the Underwriters, the Designated Lead Manager will make a secondary offering of up to 4,904,600 shares of common stock of the Company that it borrows from certain shareholder(s).
    • The delivery date is the same as the delivery date of the Secondary Offering by way of Purchase and Subscription by the Underwriters.
    • The selling price and any other matters necessary for the secondary offering will be determined by the President and Representative Director.

Here are some of the details from the Notice of Determination of Matters Pertaining to Share Repurchases and Cancellation of Treasury Shares press release:

  • The Company has resolved to repurchase its own shares with the aim of mitigating the impacts of the secondary offering on the supply and demand for the Company’s shares, as well as improving
    capital efficiency, and as part of its capital policy with agility, in response to changes in the business environment, and shareholder returns.
  • Up to 14,000,000 shares may be repurchased (1.2% of issued shares)
  • Up to 100 billion yen may be used for the buyback
  • The buyback will take place from Tuesday, March 3, 2026 to Wednesday, March 4, 2026
  • Purchased through Off-Auction Own Share Repurchase Trading System (ToSTNeT-3)

If all of this sounds confusing, it is, but the overall impact appears to be a net positive for shareholders and the company. The next impact of this will be 1.2 percent fewer shares of Nintendo outstanding. This will provide a bit of a tailwind for the company's income per share, and may send a signal to shareholders that the company does indeed find its stock is worth buying. 

Keep it locked on Shacknews as we will be keeping an eye on the execution of the Nintendo (NTDOY) secondary offering and stock buyback that will take place in the coming weeks.

This article is only meant for educational purposes, and should not be taken as investment advice. Please consider your own investment time horizon, risk tolerance, and consult with a financial advisor before acting on this information.

Full Disclosure:

At the time of this article, Shacknews primary shareholder Asif A. Khan, his family members, or his company Virtue LLC had the following positions:

Long Nintendo via NTDOY shares

Shacknews staff does not use generative artificial intelligence (AI) in their content. Shacknews strictly prohibits the use of its content for AI training or to generate text, including text in the style or format used for this publication. Shacknews reserves all rights to this work.