The Yamauchi-No.10 Family Office, managing nearly $1.5 billion in assets for members of Nintendo’s founding family, adopts a long-term strategy, willing to wait over a decade for turnaround results in its portfolio companies.
This patient approach is evident in its ongoing attempt to take marine construction firm Toyo Construction Co private, a battle that may see a critical moment at the annual shareholder meeting in June.
Chief Investment Officer Hirowaka Murakami highlights that the family office seeks out opportunities that other investors might avoid, focusing on both listed and private companies with potential to revitalize Japan.
“We are trying to do what other investors can’t or are reluctant to do. That’s the spirit we have,” Murakami told Reuters.
The family office was founded in 2020 by Banjo Yamauchi, the grandson and adopted son of Hiroshi Yamauchi, Nintendo’s third president who transformed the company from a playing card maker into a video game giant.
The office aims to preserve Hiroshi Yamauchi’s “unique creativity and pioneering mindset” to foster innovation in Japan.
Reflecting its roots, the firm’s website features colorful, 8-bit graphics and chiptune music reminiscent of early Nintendo games like “Donkey Kong,” while the office décor includes traditional “hanafuda” playing cards, Nintendo’s first product.
The family office’s conflict with Toyo, Japan’s third-largest marine construction firm, is serious. Holding 27% of Toyo, it accuses the board of “serious governance flaws and oversight failures” and plans to oppose the re-election of key executives at the June shareholders’ meeting.
Toyo Construction responded that it is setting up a committee to review the takeover proposal and has requested more information from the Yamauchi office, which the latter claims to have provided in over 100 pages of proposals.
Murakami indicated that the family office may increase its stake in Toyo after May when an agreement preventing it from doing so expires.
About half of the family office’s assets are allocated to around two dozen projects in next-generation technologies, including space debris clean-up firm Astroscale and AI-driven healthcare solutions.
As an island nation with many coastal cities, Japan could better utilize Toyo’s marine construction technology in sectors like power generation, said Murakami, a former Deutsche Bank and Goldman Sachs executive and childhood friend of Banjo Yamauchi.
The Yamauchi family office made an all-cash offer to take Toyo private in May of the previous year, offering a 30% premium over an earlier bid by Toyo’s former largest shareholder.
Despite the board’s initial support for the lower offer, which later lapsed, the Yamauchi office spent months trying to engage the board in discussions.
Murakami emphasized that their investments are not just for commercial gain but aligned with broader goals: “If your investments are driven solely by commercial purposes, then you can invest into a company, talk to them and quickly exit when you see obstacles. But is that the way we want to achieve our goals? No.”
