MCA to Build a Universal Studios Theme Park in Japan

MCA Inc. today confirmed that it will go ahead with plans to build a Universal Studios theme park in Osaka, Japan, as the first step in a major international expansion.

MCA originally disclosed plans for the park in 1994. But the project came under an extensive review after liquor giant Seagram Co. bought 80% of MCA last year from Matsushita Electric Industrial Co. Seagram Chief Executive Edgar Bronfman Jr. and MCA President Ron Meyer recently decided to approve the project.

“Clearly we’re looking to globalize our name and our brand,” Meyer said today during a visit to Japan. “It’s something I think with Seagram we can do very effectively. Whether it’s music, television or movies--or I now believe it will be theme parks--we travel internationally.”

In some locations, MCA may just build theme parks, while in others it may construct CityWalk facilities combining restaurants, shops, movie theaters and game arcades, Meyer said.

Universal Studios Recreation Group Chairman Ron Bension said MCA is looking at potential theme park sites in Europe and Asia, including locations he scouted on a recent trip to China.

“We visited several cities,” Bension said. “Universal and its movies are known throughout the world, and to the extent there are 1.2 billion people in China, we kind of think that’s an opportunity.”

If a park is built in China, it will probably be in a major metropolitan area--”Beijing, Guangzhou, Shenzhen, Shanghai--the usual suspects,” Bension said.

Other cities in Asia are also candidates for theme parks, Bension said, mentioning Bangkok and Singapore as two possibilities. “These are markets that have been good for our movies, and we believe they’ll be good for our recreational activities,” he said.

MCA will hedge its bet in the Osaka theme park by taking only a 17% stake in the project, called Universal Studios Japan. Another 17% will be held by Britain’s Rank Organisation, which is MCA’s partner in Universal Studios Florida. By holding combined ownership of more than a third, the companies will enjoy unusual clout under Japanese corporate laws.

The next-largest holding will be the city of Osaka with 25%, Bension said. The remaining equity will be held by a number of Osaka-based industrial companies, banks and trading firm.

MCA will have creative control of the theme park, Meyer said.

The project is one of the first major MCA international projects to get approval from Meyer and is MCA’s first theme park outside the United States. The proposed 140-acre theme park had been the source of much internal squabbling between MCA’s previous management team--led by former Chairman Lew Wasserman and former President Sidney Sheinberg--and Matsushita executives when the Osaka-based industrial company owned all of MCA.

Sources said Matsushita executives at one point capped MCA’s involvement at no more than 5%, annoying MCA executives who wanted a larger piece of the project.

Walt Disney Co. has done well with its Tokyo theme park, but its arrangement with Tokyo Disneyland involves only licensing and management of the park, whereas MCA’s deal involves an ownership position.

Universal Studios Japan is expected to resemble Universal Studios projects in the United States, with attractions based on such Universal movies as “E.T.--The Extraterrestrial” and “Jurassic Park.” Steven Spielberg, who directed those hits for Universal, will serve as a creative consultant on the project.

The project will cost an estimated $1.6 billion to build and is scheduled to open by early 2001.

Bates reported from Los Angeles.