Japanese media conglomerate Kadokawa, parent company of Dark Souls and Elden Ring developer FromSoftware, revealed on Wednesday that Sony has presented it with a letter of intent, which signals a serious intention on Sony’s part to acquire controlling shares. The news follows insider reports which caused Kadokawa’s share price to skyrocket by 40% in the past two days.

Letters of intent (LOIs) are typically the first official communication to kick off a large-scale purchase of shares and transfers of ownership between organizations. They often serve as the starting point for negotiations.

Sony owns the anime streaming service Crunchyroll, Japanese entertainment company Aniplex, and a significant portion (14%) of FromSoftware shares, to name a few. Sony’s intent to acquire Kadokawa appears to be part of a larger objective to expand its market share in the Japanese media industry.

FromSoftware President Hidetaka Miyazaki has become synonymous with the developer’s greatest financial and critical successes, owed to his lauded directorship of Dark Souls, Dark Souls III, Bloodborne, and Elden Ring. If an acquisition does come to fruition, Sony would be wise to avoid echoing Hideo Kojima’s controversial and highly-publicized split from Konami in 2015. With that said, details of the LOI are currently unknown, so any potential impacts to the structure of FromSoftware are left open to speculation.

In the event of a corporate sale, however, we can make some educated guesses as to the outcome. We might see a move toward PlayStation exclusivity for future FromSoftware titles, which would spell misfortune for Xbox and PC gamers, who have yet to receive a port of 2015’s dark fantasy masterpiece Bloodborne. On the other hand, Microsoft Gaming chief Phil Spencer recently advertised his intention to embrace the cross-platform market, which could create incentive for Sony to follow suit in order to stay competitive.

The usual concerns of corporate reorganization, such as layoffs and sharp changes in organizational trajectory, would likely apply as executives are rotated and Sony’s influence over FromSoftware intensifies. One hopes that such a reorganization would be handled with sensitivity for the fans, but if history is a guide, large corporations often avoid preserving the status quo of their acquisitions.

Before its acquisition by Sony, Blueprint Games produced two remakes - Demon’s Souls and Shadow of the Colossus - which were critically acclaimed, well-received by fans, but sold in modest quantities. Following its sale to Sony in 2021, the studio announced plans to develop original projects as part of PlayStation Studios - but it has yet to make an announcement three years later, with its efforts seemingly relegated to contributions on Sony cash-cows such as God of War: Ragnarok.

We focus on Blueprint Games as an example because their track record consisted of games which could be considered “fan food”. In other words, these were remakes which were lovingly-created, beautiful, highly-playable, and well-received by critics - but not sales blockbusters on the level of God of War. One can’t help but wonder if their conspicuous inactivity since 2021 is related. If so, FromSoftware could be safe from Sony interference as long as their sales remain strong.

All things considered, while it is tempting to search for omens and fortunes in the clouds, we shouldn’t get too ahead of ourselves. After all, for all we know, the Sony-Kadokawa deal could be rejected outright or simply fall apart in negotiations. We’ll just need to breathe and wait a few weeks to see what happens.