Matsushita Reportedly Won’t Bid for MCA Parks

Consumer electronics giant Matsushita Electric Industrial Co. has decided to buy MCA Inc.’s film and music divisions for $6 billion, leaving out the theme park business, according to Japan’s leading economic journal.

Nihon Keizai Shimbun, quoting unnamed Matsushita sources, reported today that MCA has told Matsushita that it wants more than $7.53 billion for all of its divisions except its New York-area television station, WWOR.

If realized, the deal would be the largest purchase of an American firm by a Japanese company.

The Associated Press in Tokyo reported today that Matsushita executives will begin direct negotiations with MCA Inc. officials as the Japanese firm pursues a buyout of the Los Angeles entertainment conglomerate.

“Until now, we have been approached by MCA through a third agent, but we finally reached the stage of direct negotiations,” the AP quoted Matsushita spokeswoman Toshiko Inui as saying. Matsushita will send its executives to the United States soon to negotiate with MCA representatives for a possible agreement, the AP said, adding that Inui would not elaborate on the negotiations.

Another company spokesman, Toshiyuki Nakahara, would not confirm or deny the Nihon Keizai Shimbun or AP reports, however. He told The Times that Matsushita would continue to pursue negotiations with MCA but that “there is no assurance these contacts will lead to any merger.” He would not comment on whether direct negotiations would commence soon.

With its 163 consolidated subsidiaries, Matsushita Electric is Japan’s third-largest corporation and the world’s 16th largest in 1989, according to Fortune magazine.

Last year, Sony Corp. acquired Columbia Pictures Entertainment, in large part to gain control over the American movie studio’s rich library of old films and television shows. Analysts say purchases of film libraries allow consumer electronics companies to release old movies and television shows in the format for videotape recorders they manufacture, a key sales strategy, and also provide material for future high-definition television recordings.

MCA’s stock rose $3.875 a share Wednesday to close at $63.50 on the New York Stock Exchange. MCA was trading for about $34 per share before reports of a possible deal surfaced Sept. 25. Matsushita’s stock has risen to 1,920 yen ($14) Wednesday from 1,630 yen ($12) on Sept. 25 on the Tokyo Stock Exchange.