Tencent has bought a 6.86% stake in Kadokawa, Japanese publishing giant and parent company of From Software. It is the biggest game-related deal in the country for the Chinese tech giant.

Kadokawa announced the deal worth ¥30 billion ($264 million) on October 29. Tencent will buy 4.86 million shares, with the deal expected to be closed between November 12 and 26.

It will let the Chinese company strengthen its position in the Japanese market, as the domestic games industry still faces scrutiny from regulators and the government.

Tencent and Kadokawa will form a capital and business alliance, investing in animation titles and their game adaptations. The partnership will also allow the Japanese company to further expand its IPs across the globe, including China.

Kadokawa is a media conglomerate that publishes around 5000 book titles a year. Its business spans different media, including films and video games. In 2014, the company acquired an 80% stake in FromSoftware, developer of games like Dark Souls, Sekiro: Shadows Die Twice, and Elden Ring.

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