The Fujisankei Communications Group, one of Japan’s largest and most secretive media congloms, is about to open its doors to outside investors. The group, which last year had revenues of $9.2 billion, is preparing to take its television and film arm, Fuji TV, to the Tokyo stock exchange, probably in 1997.
In a rare interview, Fuji TV president and CEO Hisashi Hieda, told Variety that Fuji TV aimed to raise cash to help finance development into multi-media and branching out into satellite television in Japan. Fuji TV is hoping to be awarded a satellite TV license in 1997.
“The exact date of the stock market launch will be decided by the government, but I doubt it will be next year. We are investing around $2.4 billion to build our new (Tokyo) Fuji TV headquarters next year, so I think the launch will be after 1996,” Hieda said. Under Japanese law the maximum foreign stake in Fuji TV would be 20%.
The stock market launch will be the first time that the giant Fujisankei group, which covers more than 100 companies in the broadcasting and publishing sectors, has opened up to outside capital. Last year Fuji TV posted profits of $120 million on revenue of $3.2 billion, said Hieda.
“This is one of the world’s largest media operations and one of the least well-known,” said a London-based entertainment analyst. “It will be fascinating to see if we discover a bit more about Fuji TV and consequently Fujisankei when they launch on the stock market.”
The stock market launch offers the interesting prospect of giant U.S. or European investors getting into bed with this Japanese powerhouse. Hieda plays down suggestions that it may be an awkward marriage. “If foreign groups want to invest in us I think it will be a sign that they believe that Fuji TV has certain qualities.”
Having watched the Japanese march into Hollywood, U.S. majors will now have a chance to test the waters in the land of the rising sun.
One reason for the relative anonymity of the Fujisankei name internationally is that when Japan Inc. moved into international expansion overdrive in the 1980s, the Fujisankei Communications Group, waited and watched. In addition, Fujisankei execs rarely break cover to talk to the press.
But after observing Pioneer’s problems with its Carolco investment, Sony’s writedown of its U.S. studio and Matsushita’s sale of MCA, Fujisankei is still watching, apparently trying to find a solution to the thorny problem of how a huge but fairly parochial Japanese group can best tackle the international market.
Owned and operating
The company owns Japan’s most profitable TV network, Fuji TV, along with a stable of newspapers counting 12 million daily readers, leading Japanese video and music publisher Pony Canyon and a host of Fujisankei-backed museums.
Fuji TV Network and its 27 affiliated stations dominate Japanese television. “Our division contributes about 33% of group revenues,” said Hieda, “but unlike some of the big Japanese corporations, we are totally software driven. We are software specialists, not hardware giants.”
As he reclines in his armchair and lights another cigarette, Hieda says his company’s showbiz aspirations differ from those of Sony and Matsushita. “In general terms Hollywood is a very difficult market to break into, and the Japanese who have tried have not yet been successful. And before you ask, we are not interested in buying MGM.”
Instead of pumping mega-yen into a studio acquisition, Fuji TV’s film strategy is to hook up with name producers and provide production funds. Hieda describes the process as a learning curve. “In an average year, Fuji TV will invest in between eight and 10 films, two or three of which will be non-Japanese. We invest around $35 million per year in production.”
One of the few European producers to have had direct contact with the Fuji team is David Puttnam. So far, Fuji TV has invested in four Puttnam-produced projects.