Bloomberg: Bandai to Buy Namco for $1.7 Billion in Cash, Stock
Bandai Co., creator of "The Power Rangers," agreed to buy "Pac-Man" designer Namco Ltd. for about 175.3 billion yen ($1.7 billion) in cash and stock to create Japan's second-biggest toy and video-game software maker. The merged company will have more funds to develop video games for the $20 billion global market, matching increased spending by larger rival Sega Sammy Holdings Inc., formed in a merger seven months ago, and U.S. companies such as Microsoft Corp. A wider range of characters will also help the new company spur sales of toys, arcade games and cell-phone downloads...more...

This explains why Namco sold Nikkatsu to USEN the other day.

Forbes: Takara, Tomy to merge, forming Japan's No 4 toy, game group
Takara Co and Tomy Co are in the final stages of negotiations to merge next year, a move that would create Japan's fourth-largest toy-game group with combined sales of 180 bln yen, the Nihon Keizai Shimbun and the Mainichi Shimbun reported, without citing sources... Takara has several all-time popular products, but no new best sellers. With the toy market expected to shrink, due in large part to the country's declining birthrate, the firm had been seeking a partner with which it can develop new lines, the report said.

Reuters: Japan's Square Enix in $606 mln bid for Taito
Square Enix Co, Japan's second biggest videogame maker, said on Monday it aimed to buy game machine manufacturer Taito Corp. in a $606 million deal that will boost its product lineup as competition heats up. Square Enix, which makes "Dragon Quest" and the "Final Fantasy" game series, said it was targeting all Taito's shares for 67 billion yen ($606.4 million), or a 12.5 percent premium to its latest closing price. The company added it would cancel the tender offer if it failed to buy at least 67 percent, or 247,900 shares...Square Enix itself was born from a merger in 2003... Taito shareholder Kyocera Corp. said it had agreed to sell its 36.02 percent stake, worth 24.1 billion yen ($218.1 million), to Square Enix as part of the tender.

I made my annual jaunt out to 'Toy or Us' the other day and has rather disappointed with the lack of 'neat' toys. I don't know if this is a reflection of weak sales or a lack of new ideas.

Generally, having a lot more seniors shouldn't necessarily doom the toy industry as grannies tend to spoil the grandchildren far worse than ma and pa.