His recent deal to buy part of the Hong Kong-based Next Media Group’s Taiwanese print and television business demonstrates just how wilful and unyielding the 55-year-old Taiwanese billionaire and media mogul is in pursuing what he wants.
He made the deal happen despite harsh criticism and accusations that he was trying to control Taiwan’s opinion market or that he was acting in the interests of Beijing by looking to serve as its mouthpiece on the island. In doing so, he took over the Taiwanese interests of Hong Kong tycoon Jimmy Lai Chee-ying – an unrelenting critic of the Communist Party.
November 27 was an important day for Taiwan’s richest man, head of the Taiwan-based snack food giant Want Want Holdings, who built up his fortune through the rice cracker business he established on the mainland in 1994.
Marathon negotiations that began that afternoon and ended close to midnight in an upscale hotel in Macau secured victory for him in his first battle for control of a sizeable stake in Next Media’s Taiwanese print media. His second battle is with the island’s regulators, who have yet to approve the purchase.
Given his fighting spirit and the wealth he has, victory was a “must” for Tsai, who was reported by Forbes magazine in May to have a net worth of US$8 billion.
“This will enable them to know me better so that they can accurately report what I am like exactly in the future,” he said, referring to Next Media’s Taiwanese reporters, who have been highly critical of him. He made the comment during an interview with The Journalist news weekly in Taipei on November 22, when asked why he wanted so much to buy the Next Media’s Taiwanese print business.
Since earlier this year, the Taiwanese edition of Next’s Apple Daily and the weekly Next Magazine have waged a media war against Tsai for trying to monopolise the island’s media market through his acquisition of the island’s second-largest cable television provider.
The root of that fight can be traced back to 2008, when Tsai first showed an interest in Taiwan’s media business by acquiring the financially troubled China Times Group, which owned two television stations and several print media outlets, including the half-century-old China Times daily.
The NT$20.4 billion (HK$5.43 billion) acquisition, however, upset Next Media chairman Lai’s plan to develop his television business in Taiwan by buying China Times’ television operation. Lai, the Hong Kong clothing king who became a media mogul, subsequently had to start from the beginning to set up a new television station in 2009. Next’s television operation ran up huge losses, forcing Lai to decide in October to sell all his Taiwanese media outlets.
The failure of Next TV to find a place on Taiwan’s cable channel provider due to government restrictions on channel distribution was cited as a major reason for its financial troubles. Without a channel, a conventional way of attracting viewers and advertising revenue, the Next TV programmes could only be watched through the internet or MOD, a computer file format used in digital camcorders, making it difficult to survive in the face of stiff competition in Taiwan.
At the height of their fight in the middle of this year, Lai and Tsai traded barbs through their respective media outlets almost every day. Tsai’s media ambitions and the source of his wealth became the target of attacks. Controversial remarks made by Tsai, including his comment to The Washington Postearlier this year that the number of pro-democracy demonstrators killed by mainland security forces near Beijing’s Tiananmen Square in 1989 was vastly overinflated, were magnified.
Tsai’s comments about cross-strait unification – “Whether you like it or not, unification is going to happen sooner or later” – also caused uproar in Taiwan, especially among the pro-independence camp.
Though Tsai later claimed the quote in The Washington Post had been “distorted and taken out of context”, it triggered a call by local academics and students to boycott Want Want products and its Taiwanese media outlets.
His links with the mainland – including the preferential treatment her received from provincial governments including Hunan’s when he first opened his factories, and the fact he made his fortune selling rice crackers there – has been cited as “proof” by Taiwanese critics that “he is loyal to China”.
“What the Want Want Group gains today is through the accumulation of cent-by-cent profit,” Tsai told the China Times on Friday, as he rejected allegations that he was rewarded by Beijing for his loyalty or paid by the central government to unify Taiwanese voices by monopolising the island’s media market.
Tsai insists that he is from Taiwan and he loves his homeland as much as any other person in Taiwan does.
“About cross-strait relations, like the mainstream opinion in Taiwan, I hope through consistent exchanges and interactions, the two sides are able to maintain permanent peace and stability,” he said in his paper. “Only when cross-strait peace can be maintained will Taiwan be able to retain its democratic status, and only then will the mainland be able to be influenced by Taiwan, resulting in solid democratic reforms on the mainland.”
He said he decided to get into media because he wanted people in Taiwan to know the mainland better. He said while the mainland had developed rapidly in the past decade or so, Taiwan had stayed more or less the same.
“I am really worried that Taiwanese people will be looked down upon by the mainland people,” he said.
In an article in May, Forbes noted that the scale of Tsai’s media ambitions in Taiwan and his unabashed goodwill towards the mainland had inevitably stirred criticism from industry rivals and Taiwanese democrats.
But one of Tsai’s close friends said the more criticism he received, the more determined Tsai was to fight back.
“He has never been an academic type of guy,” said former SinoPac president Paul Lo, a friend of Tsai’s for more than 25 years. “He has a kind of never-yielding spirit like a bulldog in the street, and once he is in, he will never give up,” said Lo.
Tsai appears to like that vivid description of his character, as can be seen by a giant painting of a Boston bulldog called Happy, which he used to own, hanging in the lobby of Want Want Group’s headquarters in Shanghai.
This goes some way to explaining why Tsai as been so persistent in his bid to buy into Next Media’s Taiwanese media business. The best way to avoid attacks by Apple Daily or Next Magazine was to let them know who the boss is, he suggested in his interview with The Journalist.
“They thought I was a hooligan, but I have never hurt anybody, and in the future I will let them know more about me,” he told the news weekly.
When the news of Next Media’s plan to sell its Taiwanese media business first spread in September, Tsai started working towards the purchase by teaming up with Jeffrey Koo Jnr, son of the Taipei-based ChinaTrust financial holdings chairman Jeffrey Koo Len-song, and William Wang Wen-yun, head of the Formosa Plastics Group.
He persisted even when Lai found out he was one of the buyers in the consortium and reportedly raised the price to NT$17.5 billion from NT$15 billion. By midnight on November 27, Lai agreed to sign the deal through two separate contracts to two consortiums from Taiwan. One contract involves the sale of Next Media’s loss-making Taiwanese television, the other with the group’s print media operation on the island.
Along with three Taiwanese investment partners, Tsai won the print media contract at an undisclosed price.
The contract, which includes the profitable Taiwanese edition of Apple Daily and Next Magazine, was signed by Tsai’s son, Tsai Shao-chung, on his behalf.
Under the deal, Tsai will obtain 32 per cent of shares in the group’s print media in Taiwan, with Formosa’s Wang getting 34 per cent; ChinaTrust Charity Foundation Chairman Jeffrey Koo Jnr takes 20 per cent and the rest goes to Lung Yen Life Service Corp chairman David Lee Shih-tsung.
Even with just a 32 per cent stake, the deal would make Tsai the biggest media mogul in Taiwan and would add to his four newspapers, including one English-language daily, two television stations, one weekly magazine, three online news units, and a cable TV channel provider.
Tsai’s media interests stretch as far as Hong Kong – where he has not had it all his own way.
As a shareholder in troubled broadcaster ATV, Tsai is embroiled in a lawsuit with the company’s executive director, James Shing Pan-yu, and its major investor, Shing’s relative Wong Ching, accusing them of mismanaging the business.
Tsai’s San Want Media Holdings controls 49 per cent of shares in Antenna Investment, which owns a 47 per cent stake in ATV.
San Want sought leave from the High Court last month to apply for an independent supervisor to be appointed to the station’s board of directors, saying ATV was at a real risk of losing its licence if the alleged mismanagement was allowed to continue. The application was allowed.
In Taiwan, Tsai stressed that, after the deal was finally approved, he would remain hands-off as he had been at the China Times group.
But he still has other battles to fight before he is able to consolidate his media empire on the island.
The deal requires reviewing by Taiwan’s Investment Bureau and the National Communications Commission, since it involves a foreign party, and also requires assessment by the Fair Trade Commission as to whether it would result in Tsai controlling the local news media market and reducing the diversity of opinions expressed.