Itochu is taking a 40% stake in San Francisco-based character licensing startup Octas, the latest move by a Japanese trading house seeking to capitalize on overseas demand for anime merchandise.

Following Itochu¡¯s investment, Octas will license Japanese characters and work with North American manufacturers and retailers to develop products, people familiar with the matter said, asking not to be named because the talks are private.

Streaming platforms have made anime instantly accessible worldwide, but the supply chain for official toys, apparel and collectibles has lagged behind. Itochu, which holds a 49% stake in anime development company Sky Perfect Pictures, and peers Mitsubishi and Sumitomo are racing to solve that bottleneck and capitalize on the popularity of anime and manga.

Itochu has previously worked with Octas to bring popular characters such as Opanchu Usagi to international markets. It plans to tap Octas¡¯ ties with North American manufacturers and retailers to build a long-term presence beyond one-off hits, the people said. Representatives of Itochu and Octas declined to comment.

The push into intellectual property comes as the Japanese government identifies content including manga, games and anime as a primary pillar of its economic strategy. The sector¡¯s overseas sales reached ?5.8 trillion ($37 billion) in 2023, surpassing the export value of traditional staples like electronic components and steel. Tokyo has set a target to more than triple that figure to ?20 trillion by 2033.

Japan¡¯s biggest trading firms, which have historically focused on heavy industry and energy, are ramping up investments to diversify away from volatile commodity markets. Last year, Mitsubishi inked a partnership with Tomy and Sega around characters including Sonic the Hedgehog, while Sumitomo invested in Remow, a global distributor of anime and an affiliate of publisher Shueisha.

Last year, China¡¯s Pop Mart International Group created a frenzy for collectible toys, laying the groundwork for Japanese content providers to cash in on demand for related merchandises.