China's Huayi in $4.7B Deal With Ping An Bank to Build Movie-Related Theme Parks
The private movie production company, which is partnered with STX Entertainment on a multi-project deal, said the money will focus on film and internet entertainment businesses.
Private Chinese film production company Huayi Brothers has signed a $4.7 billion deal with Ping An Bank to accelerate its multimedia entertainment business in China, including the development of 20 theme parks.
Huayi, which has produced more than 100 films in the past 21 years and was a major investor in Brad Pitt and Shia LaBeouf's Fury, said the cooperation will focus mainly on developing its film and Internet entertainment businesses, especially "outdoor entertainment" such as theme parks.
Although there are many theme parks in China, with plans for many more – Disney, Universal and DreamWorks are all opening theme parks in China in coming years -- Huayi's founder and CEO Wang Zhongjun said it was impossible to be pessimistic about the prospects for the future.
"In terms of overseas expansion, besides film Huayi will be looking at investing in sports and in the Asian market we will be looking at Japan and South Korea," Wang told a strategic cooperation conference with Ping An.
The announcement comes as Huayi Bros announced a $560 million deal with Alibaba, Tencent, Ping An and CITIC.
The stock of Huayi Brothers, which partnered with Robert Simonds' STX Entertainment for the co-financing, co-production and distribution for 12-15 theatrical releases each year, has been halted since late July. It was halted earlier that month after sharp falls in line with general market chaos.
Wang said that the stock had been halted because of an unspecified overseas investment worth more than $160 million.
Ping An Bank is headquartered in Shenzhen and is a unit of the giant Ping An insurance group.
"Tourism is changing from traditional concepts to experience tours, so we are confident about the potential for outdoor entertainment tourism. Tourism is much bigger than the film industry," said Xiao Ping, head of Ping An Bank.
Huayi Brothers is run by Wang and his brother Wang Zhonglei. The company's revenue in 2014 reached $380 million, up 19 percent, while operating profit rose 61 percent to $188 million.
That money raised will go towards the production of 12 blockbusters, 12 big-budget films and seven medium and small-budget films plus 400 episodes of TV dramas. They would also use $78 million towards paying down bank debt, Huayi said.
After Wednesday's moves, Ping An Asset Management purchased 27 million shares and became the sixth biggest shareholder with 1.98 percent.