Japan’s biggest-ever foreign media acquisition costs $1.3 billion
TOKYO: Japanese media giant Nikkei’s surprise acquisition of the Financial Times for $1.3 billion underscores its goal to be the voice of Asia on economic affairs as part of a broader Internet-driven global expansion.
But the unlikely cross-border marriage — Japanese media rarely venture overseas and are routinely criticised as timid in pursuit of investigative news — has sparked concerns about editorial independence at the storied salmon-pink business paper founded in 1888.
“The merger of the Financial Times and Nikkei will give the group a major international presence in the media sector,” the Japanese paper said in its Friday edition, touting it as the country’s biggest-ever foreign media acquisition.
President and CEO Naotoshi Okada said on the Nikkei’s website: “Our goal is nothing short of making Nikkei the leading media voice in Asia”.
In Japan, the Nihon Keizai Shimbun — or Nikkei daily — is a must-read for executives and has a strong track record of financial scoops.
About 2.7 million copies of its morning edition are printed daily while the afternoon version numbers 1.4 million copies.
The FT deal adds an internationally known brand and about 225,000 print copies to the Nikkei’s arsenal as it eyes a battle with business powerhouses the Wall Street Journal and Bloomberg.
Online, the Nikkei-FT marriage would catapult the group past the New York Times’ 910,000 Internet subscribers.
Like the FT, the Nikkei is seen as a business bible.
Its 140-year-old history is inextricably linked with Japan’s industrial sector and once-booming economy, and the Tokyo Stock Exchange’s benchmark index — the Nikkei 225 — takes its name from the group.
The move into magazines, books and television, among other sectors, has left the Nikkei on solid financial ground, even as many major media struggle with their finances in the age of the Internet.
Meanwhile, the FT has earned a reputation as one of the most nimble media giants in the digital age, building a giant subscriber base and successfully attracting advertisers because of its upmarket readership.
“It’s a good story for the Nikkei — buying the FT offers the experience online and a foreign subscriber base in the dominant language in the world, English,” said Yasuhiro Matsuzaki, deputy chief editor at the rival media group Tokyo Keizai.
“The Nikkei is already the most advanced Japanese newspaper in the digital domain but it takes time to get subscribers,” he added.
However, the takeover could make for a rocky cultural exchange.
The FT, among other media, has strongly criticised the Nikkei’s apparently privileged access to earnings results and other company news, often weeks before it is officially announced.
And the Japanese press is routinely accused of being conflict shy and self-censoring to avoid offence. That issue came into stark focus during the Fukushima nuclear crisis when some viewed the media as soft in its criticism of company and government officials.
“Worrying. Nikkei is basically a PR machine for Japanese biz; it initially ignored the 2011 Olympus accounting scandal (which FT broke),” a New York Times reporter wrote on Twitter, referring to one of Japan’s worst ever accounting scandals.
Goushi Kataoka, an economist at Mitsubishi UFJ Research, was blunt in his assessment of the deal.
“I’m worried that the Financial Times could become like the Nikkei, and I hope that will not be the case,” he said.
Robert Peston, former political editor and financial editor of the Financial Times and now BBC economics editor, also expressed concern at the sale.
“If I were still at FT, I’d ask if Nikkei respects culture of trying to hold all power to account (even if FT, like rest of us, often fails),” Peston wrote on Twitter.