Shanghai Media Group, Softbank to cooperate -sources

SHANGHAI, June 29 (Reuters) - Government-controlled Shanghai Media Group (SMG), China's second-largest broadcaster, will sign a partnership agreement on Monday with Japanese Internet company Softbank Group, people with direct knowledge of the situation said.

Softbank founder Masayoshi Son, Japan's fifth-richest man, and SMG President Li Ruigang will sign a framework agreement in Shanghai marking the start of their cooperation, although no concrete deals will be cemented, the people said on condition of anonymity.

SMG, controlled by the Shanghai government, is restructuring its operations to reduce its reliance on advertising and broaden its fund-raising channels, as China's strictly controlled media sector gradually pursues a partial opening.

Li said last month that the company was seeking funding from private equity investors in several of its businesses and will take them public over the coming two years.

Softbank Group, which owns Japan's No. 3 wireless carrier Softbank Corp (9984.T) and venture capital businesses, is seeking investment opportunities in China's fast-growing digital media industry.

SMG declined to comment. Softbank could not be immediately reached for comment.

SMG, whose 6 billion yuan (878 million) in revenues last year mainly came from advertising, is expanding beyond traditional broadcasting into digital media, content publishing and data terminal sales.

SMG's ambitious plans could put it up against state-run China Central Television, the country's only national broadcaster.

Softbank has invested in Tao Bao, China's largest auction site operator and a unit of Alibaba Group, and has established a joint research centre with China Mobile (0941.HK) to develop mobile internet services.

Softbank's founder Son has an estimated net worth of $3.9 billion and was ranked by Forbes magazine as Japan's fifth-richest person this year. (US$1=6.832 Yuan) (Reporting by Samuel Shen and Edmund Klamann)