DeNA Shares Rise on Plan to Buy Back 10% of Stock: Tokyo Mover

DeNA Co. (2432), Japan’s biggest social- gaming operator, rose the most in more than two years in Tokyo trading after saying it will spend as much as 20 billion yen ($254 million) buying back up to 10 percent of its stock.

DeNA gained 12 percent, the most since February 2010, to 1,993 yen on the Tokyo Stock Exchange. The company plans to make the purchase between today and July 31 as part of measures to reward shareholders, Tokyo-based DeNA said in a statement after the market closed yesterday.

The operator of the Mobage gaming site had fallen 23 percent in Tokyo trading this year through yesterday and joins Japanese companies including Canon Inc. (7751) and Sega Sammy Holdings Inc. (6460) in buying back shares. DeNA’s stock had dropped as government scrutiny led the company and domestic rivals to abandon a sales method said by regulators to cause excessive charges for users.

“The size of buyback is a positive surprise,” Mitsuo Shimizu, an analyst at Iwai Cosmo Securities Co. in Tokyo, said by phone. “The stock may perform well for a while on this.”

Gree Inc. (3632), DeNA’s closest domestic rival, and other social- game providers also gained on hopes they may follow DeNA in buying back shares, Shimizu said.

Gree jumped 8.4 percent to 1,710 yen. CyberAgent Inc. (4751), operator of the Ameba site, rose 5.8 percent and Square Enix Holdings Co. gained 2.1 percent.

Canon, the world’s largest camera maker, said June 4 it plans to spend as much as 50 billion yen on a buyback. Sega Sammy, a Japanese pachinko and video-game software maker, said May 31 it plans to spend 17 billion yen on stock repurchases.

DeNA also released its earnings forecast. Net income may be 9.05 billion yen in the three months ending June 30, it said in a separate statement yesterday. The forecast compares with the 9.35 billion-yen average of three analyst estimates compiled by Bloomberg.

DeNA provided the forecast under international accounting standards. The company had net income of 9.5 billion yen a year earlier under the Japanese standard.

To contact the reporter on this story: Naoko Fujimura in Tokyo at nfujimura@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net

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