Disney talk to China digital signage company

Disney

Disney is in advanced talks to buy a stake in China's largest in-bus digital media and advertising company, Bus Online. The deal would mean Disney could find a new platform to promote Mickey Mouse and other Western brands to the Chinese.

Despite calls to quit the Chinese market over censorship issues, Google, the number one internet search company is reportedly interested in acquiring a section of Bus Online in collaboration with Disney.

The consortium, including Disney and Google planned to buy a stake of between 30 and 40 percent in Bus Online for more than US$100 million via a purchase of old and new shares to be issued by the company in private placements.

"Disney wants to be a strategic partner not just a financial investor in Bus Online as Disney is going to do many things in China - for example, the theme park to be opened in Shanghai," said a source with knowledge of the talks. "To Disney, the deal is not just about sharing in the growth of China's advertising market but more about the promotion of Disney, the brand itself, and this is strategically important to Disney in China."

Bus Online - Number one advertising company

Bus Online is currently China's No.1 in-bus digital media and advertising company, with revenue of about 314.5 million yuan (US$46.07 million) in 2009.

In November, Disney's made a breakthrough deal to build one of its signature theme parks in Shanghai, marking a major advance for Western media and entertainment companies seeking to crack the Chinese market.

China is one of the fastest growing markets in the world. Large corporations like McDonald's have identified it as a growing and untapped Western market and as such the McDonald's chain is set to double in restaurants from 1100 to 2000 by the end of 2013.

Bus Online has already signed a contract with Yum! Brands Inc., to set up screens in KFC outlets across China.

According to Reuters, Disney expected to provide media content to Bus Online for its partnership with KFC in China on the condition that Disney and Bus Online agreed on the equity stake investment first.

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Ross Densley

Ross Densley is a graduate from Bath Spa University, and has freelanced for several magazines ranging across a section of topics such as animation, business, film and lifestyle. When Ross is not working he writes and edits his own satirical website.

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