Koei Tecmo

Independent era

Koei

Koei Co., Ltd. ) was founded in July 1978 by husband-and-wife duo Yoichi and Keiko Erikawa. Yoichi was a student at Keio University, and when his family's rural dyestuffs business failed he decided to pursue his interest in programming. The company was located in the Hiyoshi area of Yokohama along with Yoichi's alma mater, and the company's name is simply a spoonerism of the school's.

K? Shibusawa and Eiji Fukuzawa, whose names are supposed to have made up the name of the company, do not really exist and are names used by the company to avoid giving credit to individual contributors, effectively acting as pen names for the Erikawas.The company initially focused on personal computer sales and made-to-order business software. In 1983 it released Nobunaga's Ambition , a historical strategy game set during the Sengoku period of Japanese history. The game went on to receive numerous awards, and Koei produced several more such games set against the backdrop of world history, including Romance of the Three Kingdoms, set during the Three Kingdoms period of Chinese history, and Uncharted Waters , set in Portugal during the Age of Exploration.

In 1988, Koei established a North American subsidiary, Koei Corporation, in California. This subsidiary localized Koei games for export to all territories outside Japan, as well as producing original games and concepts with the leadership of designer Stieg Hedlund, like Liberty or Death, Celtic Tales: Balor of the Evil Eye, and Gemfire . After Hedlund's departure, this subsidiary ceased game development in 1995, focusing instead on localization, sales and marketing.

A Canadian subsidiary, Koei Canada, Inc. was established in early 2001, and a European subsidiary, Koei Limited was established in early 2003 in Hertfordshire, United Kingdom. In 2004, a Lithuanian subsidiary was formed.

Tecmo

Tecmo, Inc., formerly known as Tehkan Ltd., was founded by Yoshihito Kakihara on July 31, 1967, as a supplier of cleaning equipment. Two years later, in 1969, it started to sell amusement equipment. Tecmo had its headquarters in Kudankita, Chiyoda, Tokyo. Tecmo's United States offices were located in Torrance, California.In March 1981, a U.S. division was inaugurated as U.S. Tehkan, Inc.. A month later, in April 1981, Tehkan released in Japan its first arcade video game titled Pleiades . When it was still called Tehkan, the company also released such classic games as Bomb Jack and Tehkan World Cup. On January 8, 1986, Tehkan officially changed its name to Tecmo. In 1989 Tecmo was named as co-defendant in a lawsuit, when Indianapolis Colts running back Eric Dickerson sued the NFLPA over use of his likeness in the game Tecmo Bowl.In 2006, Founder, President and Chairman Yoshihito Kakihara died of interstitial pneumonia.On June 3, 2008, Team Ninja head Tomonobu Itagaki resigned from the company and filed a 145 million yen lawsuit for "unpaid completion bonuses" and "emotional distress". This was followed by another lawsuit filed on 16 June by two plaintiffs on behalf of Tecmo's 300 employees for unpaid wages amounting to ¥8.3 million.

Merger and reorganization

On August 20, 2008, Tecmo announced the resignation of president Yoshimi Yasuda, to be replaced by current Chairman of the Board Yasuharu Kakihara as of September 1. On August 28, Square Enix announced plans for a friendly takeover of Tecmo by purchasing shares at a 30 percent premium with a total bid of ¥22.3 billion. They gave Tecmo until September 4 to either accept or reject the proposal. Upon hearing this news on August 31, Kenji Matsubara, President and COO of Koei, called a board meeting for the next day, September 1. The board discussed the possibility of a merger with Tecmo, and began discussions with Tecmo that same day. On September 4, 2008 Tecmo officially declined Square Enix's proposal, and later that same day announced plans to merge with Koei.

To survive and compete in this market, we need to have some sort of scale - it's critical. And that's the trigger of this consolidation. Square Enix had made an offer, and we had started a discussion with Tecmo as well. But Tecmo's founding family and Koei's founders' family have actually had a good relationship for many years, which is why we were able to make a deal in such a short time! We started the discussion on September 1st, and it was agreed two days after! Tecmo's founders and management team understands that while it is nice to stand alone, it is risky, and scale is critical.

In November, the companies announced their specific plan of action, to complete the merger on April 1, 2009, forming Tecmo Koei Holdings. Koei stock was to be exchanged for Tecmo Koei stock at a rate of 1:1, and Tecmo stock exchanged at .9:1, giving Koei shareholders, in total, a three-quarter stake in the new company. Though the combined profits in 2007 were 8.5 billion yen, they anticipated that the merged company would net over 16 billion yen in the fiscal year ending March 2012. Effissimo Capital Management Pte, Tecmo's second-largest shareholder at 17.6%, openly opposed the merger. On January 26, 2009, the shareholders for both Koei and Tecmo reached separate agreements in favor of the merger. Effissimo raised some dissent during the meeting, and implied they may seek to sell their shares. Effissimo's director Takashi Kosaka stated “We have not had sufficient information from the company to make a judgment on the merger, such as the feasibility of their plan to raise shareholder value.” On February 12, Kenji Matsubara liquidated KOEI France SAS. On February 13, Tecmo announced it had received a repurchase claim from a major shareholder, 15.64% of the stock from a shareholder that stood in opposition to the firm's upcoming merger with Koei. While the requesting shareholder was not mentioned, Reuters stated that it was likely Effissimo.Despite these misgivings, the holding company formed on April 1, 2009 as planned. The development divisions of both companies were spun-out into separate subsidiaries, created specifically for the planning and development of software, operating directly under the holding company. Kenji Matsubara became CEO of the new company, and former Tecmo CEO Yasuharu Kakihara became board chairman. As of May 26, Tecmo Koei had still not reached an agreement with Effissimo, prompting the investment fund to seek mediation with the Tokyo District Court. While Tecmo Koei favored a stock value in the mid-600 yen range, Effissimo was expected to ask for at least 900, in part due to the rejected Square Enix offer of 920 per share.On June 23, 2009, Tecmo Koei announced a planned restructure of its international subsidiaries. Koei Europe was renamed Tecmo Koei Europe in 2009 and became the first subsidiary to publish games under the new moniker, starting with Ninja Gaiden Sigma 2. In August 2009 Tecmo Koei announced that it was setting up a subsidiary in Hanoi, Vietnam. In January 2010, Tecmo's sole subsidiary, the American Tecmo Inc., and Koei's American branch, Koei Corporation, were moved under a newly formed Tecmo Koei America Corporation, itself a direct subsidiary to Tecmo Koei Holdings. Koei's Canadian, Korean, and Taiwanese subsidiaries were re-branded Tecmo Koei, and also moved to direct subsidiaries of the holding company. Later that month the Entertainment Software Association announced that Tecmo Koei was now a member.On April 1, 2010, Koei absorbed Tecmo in Japan to become Tecmo Koei Games, which renamed itself to Koei Tecmo Games in 2014. Koei Singapore was also re-branded as Tecmo Koei.

Post-merger

On February 8, 2011, Tecmo Koei Holdings announced that the new individual developers Tecmo and Koei that were formed in March 2010 would be merged into Tecmo Koei Games in April 2011, though the company will continue to develop under the Tecmo and Koei brands.The continued operating loss prompted Kenji Matsubara, the former president and CEO of both Tecmo Koei Holdings and Tecmo Koei Games label, to render his resignation in November 2010. Yoichi Erikawa, co-founder of Koei, took over the four positions vacated by Matsubara.On July 1, 2014, the company and its related subsidiaries were renamed from Tecmo Koei to Koei Tecmo.On February 18, 2016, Koei Tecmo announced a second reorganization of the company, to support the expansion of the company. Brand names Team Tachyon, Koei and Tecmo, amongst others, were dropped.