Sony Plans Bid Versus Blackstone, KKR for $1.3 Billion Manga App

(Bloomberg) — Sony Music Entertainment is preparing a bid against private equity funds Blackstone Inc. and KKR & Co. to acquire Japanese e-comics provider Infocom Corp. in a deal estimated to be worth around ¥200 billion ($1.3 billion).

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A second round of bidding for Teijin Ltd.’s entire stake in Infocom will be held in May, according to people familiar with the matter, who asked not to be named discussing non-public information.

Sony Group Corp.’s music arm is discussing an offer with Japanese fund Integral Corp. and the suitors are considering acquiring all of Infocom’s shares to take the Mecha Comics manga app operator private, one of the people said. Industrial textiles maker Teijin holds 55.1% of Infocom, according to data compiled by Bloomberg.

Tokyo-based Sony has been seeking to expand its content offerings and has become more active in high-profile deals. It’s now partnering with Apollo Global Management Inc. on a proposed $26 billion purchase of Paramount Global, which holds rights to movies like The Godfather and Top Gun: Maverick.

Sony’s shares fell around 1.8% in Tokyo, hitting a 13-month low, weighed down on concerns about how it would finance a Paramount deal. Infocom shares remained untraded on a glut of buy orders, and were set to rise by their daily limit. Teijin’s stock rose 3.6% to their highest since September.

Representatives for Sony, Teijin and Blackstone declined to comment, while Integral and KKR didn’t respond to requests seeking comment.

Sony’s interest makes an Infocom sale more realistic, according to SMBC Nikko Securities analyst Go Miyamoto. The proceeds and gains from the sale are now likely to be on a much larger scale, and could amount to ¥116 billion, he said in a note to investors.

The e-comics market has been expanding rapidly within the smartphone ecosystem, with annual sales of digital manga now more than double those of their paper counterparts at ¥483 billion. Mecha Comics faces rivals from manga apps including those run by Japan’s biggest messaging platform Line Corp., as well as those operated by units of South Korean messaging giant Kakao Corp. and Japanese telecom giant Nippon Telegraph & Telephone Corp.

Teijin, which hit a 52-week low in February, has been seeking to trim its non-core operations to focus on longterm growth.

In addition to its music operations, Sony Music Entertainment owns Aniplex, the producer of the blockbuster anime hit Demon Slayer. It also has a stake in Japanese anime distributor Crunchyroll, a joint venture with Sony Pictures Entertainment.

Blackstone has supplied funding to Candle Media, a studio led by former Disney executives, while KKR has invested in David Ellison’s Skydance Media.

–With assistance from Yuki Furukawa, Manuel Baigorri and Edwin Chan.

(Updates with share reaction and analyst comment)