Dentsu plans Chinese online ad joint venture-paper

TOKYO, Jan 22 (Reuters) - Japanese advertising firm Dentsu Inc (4324.T) plans to set up an Internet advertising joint venture in Beijing with Chinese counterpart Focus Media Holding Ltd (FMCN.O), the Nikkei business daily reported on Tuesday.

Dentsu hopes to better compete with U.S. and European rivals that have already set up operations in the booming market by teaming up with the major Chinese agency, the paper said.

The joint venture, to be established in March, will be capitalised at $9 million, with Dentsu taking a 67 percent stake and Focus Media the rest, it said.

Dentsu will consolidate its existing online ad subsidiaries in China into the venture, the Nikkei said, adding its first-year sales are targeted at 5 billion yen ($47 million).

China's Internet ad market was worth about 140 billion yen last year, just one-third the size of Japan's, but it continues to grow at an annual rate of nearly 50 percent, the paper said. (Reporting by Taiga Uranaka)