Nikkei Inc., the biggest media company in Japan, bought the Financial Times for $1.3 billion. Global media was surprised when the Japanese media company bought FT for a hefty amount after taking interest only five weeks ago. Axel Springer in Germany was eyeing the news company for a year before Nikkei came into the picture. Pearson held the FT Group for 58 years before selling it.
The Financial Times, founded in 1888, expanded its circulation by 30 percent in the last five years having a readership of 737,000. 70 percent of which is digital and half of that has been accessed on mobile devices. In 2014, the group reached £334 million in sales and £24 million in profit, according to CNN.
Pearson sold the FT Group to focus more on its main business, which is publishing and producing educational materials. Pearson wanted FT to be handled by a global news company that focuses its effort on the digital market. Pearson did not incorporate the ownership of their 50 percent share in the Economist in their deal with Nikkei. They are planning to keep their building in London as well, CNN added.
Nikkei has already established itself in Japan and wants to expand globally. Acquiring the Financial Times would give them a huge opportunity in reaching out to English readers. In Japan alone, Nikkei has a readership of three million and an online readership of 400,000 paying subscribers. Nikkei spearheaded the development of the metered paywall system that requires payment after reading a certain number of articles. The New York Times and Boston Globe are some of the online news websites that followed suit, the New York Times reported.
Tsuneo Kita, president of Nikkei since 2008, assured that FT's editorial independence will be maintained. Kita has full confidence in FT's editor, Lionel Barber and wants to make the group "much stronger", Financial Times announced.
