Matsushita's deal to buy MCA highlights booming foreign investment in Hollywood.

Matsushita's deal to buy MCA highlights booming foreign investment in Hollywood

Hollywood may remember 1990 as the year Japan took over its motion picture industry.

The most widely discussed acquisition was Matsushita Electric Industrial Co.'s deal to purchase MCA Inc. for $6.6

By year's end, there was little left of major Hollywood studios not owned by foreign companies. Others were using Japanese money to make movies.

Matsushita was following the lead of Pathe Communications of Europe, which bought MGM/UA Communications Co. in October for $1.3 billion, or $21.50 per share; Sony Corp., which bought Columbia Pictures for $3.41 billion in 1989; and Australia-based News Corp., which bought 20th Century Fox in 1985.

Of the major players, this left only Warner Bros., owned by the media giant Time Warner, Walt Disney Co. and Paramount. And these companies are not free from foreign investment.

In 1990, the Japanese securities giant Nomura Securities invested $200 million in films distributed by Warner Bros. and Disney.

Investors at Yamaichi Securities, also of Japan, in October entered into a $600 million joint venture with Disney. Pioneer Electronic Corp., another Japanese firm, bought an interest in Live Entertainment and Carolco Pictures. Additionally, a consortium of Japanese corporations called Media International in June announced it would invest $200 million to $700 million in Hollywood entertainment ventures.

"There's a recognition that (movie making) is a franchise they can't duplicate, so why not invest in it?" said analyst Paul Marsh of Bateman Eichler, Hill Richards Inc. But, he said, if the Japanese try to buy Disney, "I think there'd be an act of Congress to prevent that."

While Disney may be safe from a takeover, it stayed in the news in 1990 with a plunge in its stock prices, its plans to develop office/studio space on its 44-acre Burbank lot, and the pitting of Long Beach against Anaheim in competition for a new Disney theme park.

In September, Disney unveiled plans for Port Disney, a $2 billion aquatic "Disney Sea" theme park and resort it plans to build if Long Beach comes out on top. Plans for a second park near Disneyland, should Anaheim be selected, are expected to be released in early 1991.

Disney forged ahead with the plans despite a stock plunge it said was brought on by concerns over the effects of high gasoline prices on theme park attendance.

Disney is also working on a master plan for development of its property in Burbank, said Alan Epstein, vice president of Disney Development Co.

"We don't have a timetable. When we're ready, we'll go forward with it," Epstein said.

Neighboring homeowners spoke out against the expansion plan in October, based on information that it would be submitted to the city for approval prior to a February 1991 electorate vote on a slow growth referendum.

Burbank city planners said no applications or plans had been filed by Disney by mid-December. Epstein would not say when Disney will submit its plan to the city.

News surfaced at Los Angeles City Hall in May that Paramount Pictures had approached the City Council about the possibility of building a massive office building in Hollywood, perhaps as large as 250,000 square feet.

But the studio, as late as December, had yet to make an announcement regarding its plans either. "It's way too early," said studio spokeswoman Ellen Hamilton.

Julie Jaskal of Councilman Michael woo's office said in December that "nothing has happened" regarding the project since discussions in the spring

Columbia Pictures Entertainment in 1990 moved its corporate headquarters from New York to Southern California.

Corporate spokesman Mark Gill said Columbia began moving its headquarters to Burbank in November 1989 and then switched to Culver City as its headquarters in June 1990.

A complete move of executive offices to Culver City, however, depends on Columbia's planned expansion and renovation of its 44.7-acre studio lot there, Gill said. Because space at the Culver City location is limited, about 20 New York executives are moving to Burbank temporarily, he said, adding that the Culver City expansion may take as long as two years.

"We are in the hearing stage," he said.

Gill denied reports published in November in the Business Journal that said the studio would make Burbank its national headquarters.

"We are temporarily housing New York people by moving them into Burbank until we can get facilities built," he said.

Co-chairmen Peter Guber and Jon Peters set up primary offices in Culver City in the fall but still maintain auxiliary offices in Burbank, Gill said.

Susan Romeo, a consultant to Columbia from Urban Planning Consultants, confirmed that "essentially, Culver City is the headquarters."

"Some executives are going to be temporarily in Burbank, but the headquarters will be Culver City," said Romeo.

Twentieth Century Fox, meanwhile, said it will move out of Los Angeles County unless the City Council approves its plan to expand its Century City complex and move its KTTV-TV Channel 11 studios there from Hollywood.

The expansion is opposed by Century City homeowners, who say the required zone change would lead to increased traffic.

PHOTO : The last stand: Paramount is one of the few remaining U.S.-owned studios