Back in the early days, when Microsoft was trying to break in to the nascent video games console space, there were rumors that Microsoft had tried to acquire Nintendo. In an interview with IGN airing on IGN Unfiltered, Xbox co-creator Ed Fries dispels that rumor, but adds some interesting new perspective on Microsoft's efforts to get into video games at the time.
Fries was one of the co-founders of the Xbox, joining the company in 1986, and eventually leading a team that created the first Microsoft game console. He left the company in 2004, and is currently working on bringing World of Warcraft and Minecraft to 3D life with his newest company, Fingerprints, according to Wikipedia.
In the interview, Fries pauses when asked if Microsoft ever considered acquiring Nintendo, and then said:
"When we first started thinking about doing Xbox, we met with Nintendo. We sat down with Iwata and others and said 'this is what we want to do, could we partner?' And basically they said no.
Then Bill (Gates) met with Sony, same deal. Can we work together, can we partner. And they said no.
So that is true. Actually if anyone thought about buying Nintendo, I never heard that."
(edited slightly for clarity)
Here's the snippet of the video, now uploaded to YouTube:
From there, Microsoft went on to create their own Xbox console, first launched in November of 2001.