February 8, 2011
Notification of NTV's Subscription of MADHOUSE Share Allotment
Nippon Television Network Corporation (NTV) is to be the recipient of newly-issued shares allotted by MADHOUSE Inc.(MH), thus making MH a subsidiary of NTV.
MH is a medium-sized animation production house founded in 1972 by former staff of MUSHI PRODUCTION, CO. Ltd, which is famous for producing theatrical releases such as "METROPOLIS" and "VAMPIRE HUNTER D," and television series such as "CARDCAPTOR SAKURA" and "THE FIGHTING (Hajimeno Ippo,)" among numerous other animation works. MH is also recognized overseas as the prestigious animation production house of "Ninja Scroll" and "Millennium actress," which have both earned worldwide accolades. As a result of MH's deal with Marvel Entertainment, LLC, MH created animations based on Marvel characters, such as "Iron Man" and "Wolverine."
As MH's second largest shareholder, NTV owns 10.4% of MH shares and maintains a close relationship with MH through co-producing for NTV's midnight animation series slot and blockbuster film "SUMMER WARS," which won a slew of awards, including "Best Animated Feature" at the Japan Academy Prize.
While MH has been struggling to adjust in the post-Lehman era of an ever-changing business environment, NTV highly values MH's animation production capabilities and brand power. By incorporating MH as our subsidiary, we believe the NTV Group can further develop business opportunities in the wide-ranging fields of movies, television broadcasting, merchandising, videograms and VoD. Therefore, NTV made the decision to subscribe approximately one billion yen equivalent of shares allotted by MH through negotiations with MH and its current parent company, Index Corporation.
Upon completion of this subscription with NTV owning about 85% of MH shares, MH will be one of our subsidiaries. NTV employees who are knowledgeable in the content business will be sent to serve as MH's management. By combining MH's production prowess and NTV Group's planning and sales abilities, we will produce animations which meet market needs. Furthermore, by implementing our content management expertise, we aim to have MH earn an annual operating profit of 300 million in three years.
This investment is in accordance with our medium- to long-term strategy to diversify our business portfolio through leveraging our strengths, and we will, in the medium-term, contribute to enhancing the value of the NTV Group.
Nippon Television Network Corporation