Alibaba Pictures Chair Named CEO of China's Enlight Media
The appointment follows the e-commerce giant's purchase in March of an 8.8 percent stake in the Chinese production firm for $380 million.
Chinese e-commerce giant Alibaba will look to boost its film efforts and its loss-making movie unit by strengthening its ties with Enlight Media. The companies said Monday that Alibaba Pictures chairman Shao Xiaofeng would become CEO of Enlight, one of China's leading private film production companies.
Alibaba acquired an 8.8 percent stake in Enlight for $380 million in March.
The appointment of Shao is being read in China as deepening the relationship between the companies, giving Alibaba Pictures greater competitiveness in the mainland market. Alibaba is Enlight's second-biggest shareholder.
Alibaba founder and executive chairman Jack Ma has ambitions to become a major player internationally and described Alibaba as "the biggest entertainment company in the world," but its movie unit has struggled to find its feet since its purchase in June last year. Alibaba Pictures notched up a $54 million loss in 2014.
In an announcement to the Shenzhen Stock Exchange, where it is listed, Enlight said Monday it agreed to appoint Shao to the CEO post after a board meeting. Enlight, which last year picked up Israeli production firm Keshet's Rising Star format, has a strong track record with domestic productions and has made no secret of its international ambitions, including Hollywood expansion. The group was founded by Wang Changtian, who is currently president of the company.
Initially, the attraction for Alibaba was probably Enlight's strong domestic base. In 2012, its low-budget comedy Lost in Thailand brought in $202 million in China. Last year, Enlight said it would make 32 movies by May 2017, investing a total of $550 million.
Alibaba's main revenue stream is selling products online, but its recent expansion has seen it invest in online video streaming sites, Internet TV hardware, sports, film production and video games.
Soon after it bought control of ChinaVision Media Group for $800 million to form Alibaba Pictures, Alibaba discovered accounting irregularities relating to tax and VAT misstatements over the purchase of artworks and TV copyrights, as well as certain TV drama production costs.
Shao, chief risk officer at Alibaba, was brought in to shake things up as chair alongside Zhang Qiang, a former senior executive in the state-run China Film Group, as CEO and Alibaba vice president Liu Chunning.
Last month, Alibaba said that it would incorporate its Taobao Movie online ticketing business and its Yulebao production crowdfunding platform into Alibaba Pictures as it tries to stem losses at the group. In August, Alibaba and Ma’s Yunfeng Capital bought a $1.2 billion stake in online video website Youku Tudou.
Alibaba spent more than $3 billion in the entertainment industry last year, and the cash-rich company went window shopping for content and even potential acquisitions in Hollywood last year, but it has yet to make a major move there.
The group is involved in a slate of films to be produced by Hong Kong filmmaker Wong Kar-wai, including Bai Du Ren, which will be directed by the novelist Zhang Jiajia and feature Tony Leung as the lead actor.