J-Pop Star Retires Amid Fuji TV Harassment Investigation

Masahiro Nakai, a former J-pop star who transitioned to a TV hosting career, announced his retirement following sexual harassment allegations. In response, Fuji TV revealed it would conduct a new investigation into the matter, a move that has raised concerns among advertisers.

The TV company has rejected tabloid claims that its staff were involved in organizing a party where the incident occurred. However, its reaction to the scandal, combined with calls for increased transparency, led some of the country's biggest firms to halt advertising on the station, which further caused the shares of its parent, Fuji Media Holdings Inc., to plummet.

“I am sincerely sorry for causing so much trouble and losses to so many people,” Nakai said in a statement on his company’s website. He apologized to the victim and signed off with: “Thank you for these 37 years. Sayonara.”

James Rosenwald-backed activist investor Rising Sun Management Ltd., which holds over 7% of Fuji Media, has been the most vocal critic, calling for the company to establish a third-party investigation. In response, Fuji TV announced on Thursday that it will form an independent panel to present its findings by the end of March.

Sponsors such as Toyota Motor Corp., McDonald’s Holdings Co. Japan Ltd., Nissan Motor Co., and Seven & i Holdings Co. have paused their advertisements on Fuji Media Holdings Inc.'s TV station. The broadcaster has warned that this loss of ad revenue could impact its financial performance. The controversy has also provided an opportunity for activist investors to target one of Japan’s largest broadcasting networks.

Shares of Fuji Media fell nearly 8 percent on Thursday, ending a four-day streak of gains, as trading volumes surged. Additionally, the spread on its corporate bonds reached a record high that same day.

The 52-year-old Nakai had earlier issued an apology on his website, acknowledging that there had been “trouble”, but clarified that no violence was involved. He mentioned that both parties had come to a settlement and agreed to keep further details confidential.

The story first came to light in December when local weekly Shukan Bunshun reported that a staff member from Fuji TV allegedly facilitated the meeting between Nakai and the woman.

“At stake is the issue of governance,” Fuji TV Vice Chairman Ryunosuke Endo said during a regular news conference as the chairman of the Japan Commercial Broadcasters Association. The response from advertisers is “confronting us with a firm ‘no,’ regarding our governance,” he said.

Nakai is a long-time TV personality and former member of the iconic boy band SMAP. For years, he has been a mainstay on Japanese television. In 2019, the death of Johnny Kitagawa sent shockwaves through his renowned talent agency, which was subsequently rocked by numerous allegations of sexual abuse involving young boys.

Rising Sun's involvement came after it proposed taking Fuji Media private through a leveraged management buyout, citing the company's poor share price performance and low return on equity. The group argued that Fuji Media would need to be broken up for restructuring to succeed.