Matsushita to Invest MCA Money : Japan: Cash will fund multimedia projects.

Matsushita Electric Industrial Co. said Tuesday that it will use the $5.7 billion it receives from the sale of most of MCA Inc. to fund a string of new investments.

President Yoichi Morishita said proceeds from the sale of the Hollywood film company to Seagram Co. will help it invest more aggressively in other multimedia projects. Matsushita is not abandoning the sector, he said, as some analysts had speculated it would.

“The proceeds from the sale of 80% of MCA will be invested, largely in dollars, in multimedia, our existing core business and new enterprises over the next four to five years,” Morishita told a news conference. He did not elaborate.

When it bought MCA in 1990 for $6.1 billion, the Japanese electronics giant described MCA as the pillar of its multimedia strategy, providing access to entertainment software that could be run on the firm’s electronic hardware.

But in the ensuing years, Matsushita gained little clear benefit from the acquisition, and many analysts saw the sale of its MCA stake to Seagram, announced Sunday, as an acknowledgment of failure.

Under the agreement, Matsushita will retain a 20% stake in MCA, whose Universal Pictures operation produced such Hollywood blockbusters as “Jaws,” “Jurassic Park” and “E.T.”

Seagram, a Canadian beverage company, said financing for the transaction will be provided by a portion of the $7.7 billion it received from the sale of most of its stake in chemical maker DuPont.

Morishita said Matsushita’s remaining stake in MCA will continue to play a major part in its strategy.

“MCA is not just an American but a global cultural property, and we expect it to grow and develop,” he said.

But he acknowledged that Matsushita--which had been mired in a battle over autonomy with top MCA executives since late 1994--had not struck a deal with Seagram giving it first option on rights to MCA software.

“We will be talking about this with Seagram from now on,” Morishita said.

He said Seagram Chief Executive Edgar Bronfman Jr., 39, is well qualified to steer MCA into the next century because of his youth and understanding of the U.S. entertainment industry.

“We think it is desirable to entrust the management of MCA to Seagram, and that’s why we decided to sell,” Morishita said.

He said Matsushita, owner of the Panasonic, Technics and National brands, will probably suffer a foreign exchange loss from the sale but that the size of it will not be clear until next month.

In the fiscal year ended March 31, 1994, Matsushita earned about $759 million.