Sony to acquire control of Japan ad agency

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Sony Corp. is expected to announce later this month the acquisition of an estimated 70% stake in Tokyu Agency International, Japan's 21st-largest shop.

TAI is 51% owned by Tokyu Group, a conglomerate that includes railroads and a department store as well as Tokyu Agency, Japan's third-largest agency. Tokyu Group is selling its entire 51% stake in TAI to Sony, as part of the marketer's diversified and fast-growing multimedia operations.

Sony and Honda Motor Co. already each own 12.5% of TAI, which had 1995 billings of $351 million and gross income of $45 million. D'Arcy Masius Benton & Bowles, New York, holds a 24% stake. DMB&B is likely to sell a portion of its share but is believed to want to keep as much as possible to maintain a relationship with Sony.


Sony will tap Koshiro Ando to head TAI, said an executive close to the deal. Mr. Ando is a 35-year Dentsu veteran who has worked in senior account management as a member of the board and as a financial adviser within the agency.

Sony invests $1.3 billion in advertising worldwide and is the 10th-largest advertiser in Japan, where the company's ad budget is about $350 million, according to Advertising Age International figures.

The consumer electronics giant wants to control an ad agency as an additional element in its growing role as media owner and content provider, as well as advertiser.


One of Sony's next moves will be into digital multichannel TV.

Sony, Rupert Murdoch's News Corp. and Softbank Corp. are equal partners in the Japanese satellite TV venture BSkyB, scheduled to start broadcasting a 150-channel service in April 1998.

Sony has already launched a Sony Entertainment Channel in India and Latin America, and owns U.S. movie studio Sony Pictures Entertainment as well as the PlayStation videogame system sold worldwide.

TAI's biggest client is Sony, but it also works for Procter & Gamble Co. and Gillette Co.'s Braun.

Sony plans to change the agency's name this spring.

Copyright March 1997, Crain Communications Inc.

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