Japan grabbed another big movie studio today as MCA Inc. agreed to be purchased by Matsushita Electric Industrial Co. in a deal valued at $6.59 billion, or about $71 a share.
The deal, announced simultaneously this morning in New York and Osaka, ends long-running speculation about the future of MCA, one of Hollywood's biggest companies. But it also pays shareholders, including Chairman Lew R. Wasserman, much less than many had expected.
MCA President Sidney J. Sheinberg said the price was a good one, given the soft economy here and abroad. But he added: "Would we have liked to have received more? Sure. If I told you no, you'd say I'm the biggest jerk you've ever run into."
Matsushita, a consumer electronics giant whose brand names include Panasonic and Quasar, will pay $66 in cash for each of MCA's 92.8 million shares. MCA stockholders will also receive stock valued at about $5 a share in a new spinoff that will own the company's New York-area TV station.
Matsushita officials said they will dispose of MCA's interest in concessions at Yosemite National Park within a year, putting an end to concerns that a foreign company might soon be turning a profit on the park.
At a video press conference transmitted from Osaka to reporters in Tokyo, Matsushita President Akio Tanii said that "fundamentally, we will leave the management to" current MCA officers. Wasserman and Sheinberg both have five-year contracts to remain with MCA under the deal.
When asked whether Matsushita would object if MCA proposed to produce a "Japan-bashing" film, or even one critical of the late Japanese Emperor Hirohito's role in World War II, however, Tanii became agitated and said:
"Something like that (film) shouldn't emerge. . . . (MCA executives) will have the proper judgment with regards to the social impact. Filmmakers must create films that are inspirational, that will be enjoyable for everybody. I can't even imagine a case like that."
MCA owns Universal Studios and has interests in film and TV production, records, books, movie theaters and other areas. The combined companies are likely to post sales of more than $51 billion this year and will be larger than all of the other Hollywood studios and their corporate parents combined, including Sony Corp. and its Columbia Pictures subsidiary.
After signing the deal in New York, Wasserman returned by company plane today to Los Angeles. While most stockholders will receive cash from Matsushita, the 77-year-old Wasserman will be paid a special issue of Matsushita preferred stock that will help him and trusts under his control to avoid huge tax payments.
Some shareholders privately complained today that the price was much too low. "It's unbelievable. Lew told me this was a $100 (a share) stock," said one big shareholder, who declined to be identified.
But other holders said the deal is clearly the best that could be made in a bad economic environment. "Under the circumstances, I think it's an extraordinary price for MCA shareholders," music mogul David Geffen said.