Japanese game maker Sega Sammy sells resort to US fund

Sega Sammy, the Japanese entertainment company known for its popular “Sonic the Hedgehog” video games, announced on Friday that it will be selling its resort complex Seagaia to Fortress Investment Group, a U.S.-based company. This decision comes as part of Sega Sammy’s strategic move to divest its holdings and focus on its core strengths in the video game industry.

The deal, which involves the sale of all shares in Phoenix Resort Co., the operator of Seagaia in Miyazaki, southwestern Japan, is expected to result in a gain of about 8.5 billion yen ($55 million) for Sega Sammy in the fiscal year through March 2025. The financial terms of the transaction were not disclosed.

Fortress Investment Group was chosen as the buyer due to its extensive experience in the hospitality sector, having acquired 176 hotels since 2011. Sega Sammy will retain a 20% stake in Phoenix Resort Co. through newly issued shares, allowing the company to maintain a partnership with the resort after the ownership transfer is completed.

In addition to the sale of Seagaia, Sega Sammy reported a decline in profit for the fiscal year ending in March, with sales increasing by 20% to 467.8 billion yen ($3 billion). Despite challenges posed by the pandemic, the company’s entertainment operations, including successful video game releases like “Persona 3 Reload,” have continued to perform well.

Looking ahead, Sega Sammy remains optimistic about its future prospects, particularly in the gaming sector. The company’s focus on leveraging its iconic Sonic the Hedgehog franchise for licensing revenue, as well as its diverse portfolio of intellectual property in animation works, bodes well for sustained growth.

By offloading its resort operations to Fortress, Sega Sammy aims to streamline its business operations and concentrate on driving innovation and creativity in the video game industry. With the support of Fortress as a strategic partner, Sega Sammy is well-positioned to navigate the evolving landscape of entertainment and technology.

As Fortress Investment Group continues to expand its presence in the hospitality industry, the acquisition of Seagaia represents a significant opportunity for growth and development. With the backing of SoftBank Group Corp. and potential ownership by Mubadala, Fortress is poised to strengthen its position as a key player in the global investment landscape.

In conclusion, the sale of Seagaia marks a new chapter for Sega Sammy as it refocuses its efforts on its core businesses in the gaming sector. With a clear strategy in place and a strong partner in Fortress, Sega Sammy is poised to drive innovation and create value for its customers and stakeholders in the years to come.

https://abcnews.go.com/Technology/wireStory/japanese-game-maker-sega-sammy-sells-resort-us-110096987

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