China's Huayi Brothers Finalizes Pact With STX Entertainment
The deal was approved at a shareholders' meeting in Beijing.
Directors of the leading Chinese film and television company, Huayi Brothers, formally approved an 18-film co-financing and distribution agreement with Bob Simonds' new STX Entertainment.
The deal marks one of the first major investments by a Chinese company in a Hollywood studio film slate and became effective after it received Huayi Brothers' shareholder approval at a meeting in Beijing.
The deal was approved by directors at a meeting on Wednesday.
Huayi Bros. announced the deal in mid-March in a regulatory statement, but didn't name the U.S. partner. It subsequently turned out to be STX.
A team for Manatt, Phelps & Phillips, LLP, led by partner Lindsay Conner, negotiated for Huayi Brothers.
The deal marks a milestone for Huayi Bros, China's largest private-sector film company, which has seen two previous deals fall by the wayside. A much-vaunted pact with Legendary Entertainment in 2013 failed to materialize, while last year, Huayi's deal to invest $100 million to $120 million in Jeff Robinov's Studio 8 likewise fell apart.
Siblings Wang Zhongjun and Wang Zhonglei, who run Huayi, remain determined to establish a sizeable foothold in the U.S. film business. To date, the company has invested in individual films like Sony's Fury and Lionsgate's John Wick and Mortdecai, and has also set up a U.S. subsidiary.
Launched in 2014, STX Entertainment has amassed a stable of seasoned studio executives, including former Universal chairman Adam Fogelson and veteran marketing executive Oren Aviv.
STX is backed by venture capital firm TPG, Chinese private equity firm Hony Capital and equity from Gigi Pritzker and Beau Wrigley. Its film slate also includes psychological thriller The Boy and The Secret in Their Eyes, starring Chiwetel Ejiofor, Nicole Kidman and Julia Roberts.