×

Korea’s CJ Orders Up Merger of Media and Shopping Units

CJ E&M, South Korea’s largest film and TV group, is set to merge with CJ O Shopping, the CJ group’s home shopping and e-commerce business.

The move was proposed at a board meeting Wednesday and is set to go ahead in August, if it receives approval in June from both sets of shareholders.

“The decision was based on a strategic point of view that the combination of CJ O Shopping and CJ E&M’s business abilities can mark the start of a global media commerce company… and help them gain competence in the rapidly changing media industry,” the two said in a joint statement.

In an investor presentation, the two said that the new group, which would continue under the CJ O Shopping name, would combine strengths in merchandise and commerce (from CJ O Shopping) and content production and distribution (from CJ E&M).

CJ E&M spans market leading film production and distribution company CJ Entertainment, as well as TV channels Mnet and tvN. It also has a stake in South Korea’s leading multiplex chain CJ-CGV, which has a separate share listing.

The companies pointed to a changing corporate landscape, in which a media big bang has already taken place and in which companies are now engaged with a series of new competitors in a “cross-business battlefield.”

The presentation pointed to examples in North America (where Disney is poised to swallow Fox, and Amazon and Netflix are the new powerhouses,) Europe (where companies including TF1, ProSieben and Mediaset are seeking alliances that increase scale and global competences,) and in China (where IP is now the basis for media-commerce expansion and giants Alibaba and Wanda have become corporate predators).

In addition to the current media, content and commerce activities, the companies say that logical expansion would include theme parks, animation and toys, as well as data businesses.

The combined company is forecast to have revenues of $4.1 billion (KRW4.4 trillion) in the current year, and operating profit of $326 million (KRW350 billion) won. They target annual sales growth of 15% per year through 2021.

Significantly, a large proportion of the anticipated growth will come from outside Korea. Currently the two earn 17% of revenue abroad. In three years they anticipate that rising to 32%. Achieving that involves aggregating competencies in Vietnam, Malaysia, Thailand and Turkey. CJ-CGV already has theater operations in Vietnam and Turkey, which have helped CJ Entertainment to put down roots as a producer distributor.

More Film

  • Terry Jones, Director of Monty Python

    Terry Jones, Co-Founder of Monty Python, Dies at 77

    Terry Jones, co-founder of Monty Python, died Wednesday. Jones died after a long struggle with dementia. He was 77 years old. Jones was instrumental in creating the wacky, absurdist style of comedy that Monty Python made famous in the 1970s and directed two of the English comedy group’s most successful films, “Monty Python and the Holy [...]

  • Legion M Launches Film Scout Mobile

    Film News Roundup: Legion M Launches Film Scout Mobile App at Sundance

    In today’s film news roundup, Legion M is launching its Film Scout mobile app, the first round of Oscar presenters are unveiled, Verve is expanding its book-to-screen business, “Gladiator” producer David Franzoni boards an American Indian project, and XYZ announces promotions. SUNDANCE LAUNCH Fan-owned Legion M is launching its Film Scout mobile app at this [...]

  • Writers vs Agents Packaging War WGA

    APA Reaches Deal With Writers Guild of America

    APA has reached a deal with the Writers Guild of America, ending a nine-month standoff over allowing the agency to represent guild members. The full-service agency made the announcement Tuesday, four days after the Gersh agency signed a similar deal with the WGA. It’s the sixth mid-size agency to accede to the WGA’s bans on [...]

  • UTA Sundance

    UTA Marketing Ups Sundance Game With Private Residence, Programming

    Talent agency hospitality is a mainstay at the Sundance film Festival, be it in swanky lounges on Park City’s Main Street or private chalets in nearby Deer Valley. United Talent Agency, whose talent roster and independent film group always come in force each year, typically throws a brunch for friends and press — but will [...]

  • Joel Silver

    Silver Pictures Settles with Family of Assistant Who Died on Bora Bora Trip

    Silver Pictures has reached a confidential settlement with the family of Carmel Musgrove, the assistant to Joel Silver who was found dead in a Bora Bora lagoon in 2015. Musgrove’s family filed a wrongful death suit in 2017, alleging that she had been overworked and furnished with drugs and alcohol during the trip. The family [...]

  • David O. Russell

    David O. Russell Looks at 'Three Kings' 20 Years Later

    When David O. Russell made “Three Kings” in 1999, it was one of the most definitive films on the Gulf War. At the time, the director had worked on shorts “Hairway to the Stars” and “Bingo Inferno: A Parody on American Obsessions.” He had also worked on features “Spanking the Monkey” and “Flirting with Disaster.” [...]

More From Our Brands

Access exclusive content