UltraStar Cinemas to Build 40 Digital Theaters in China

The San Diego-based company is the latest to get in on China's exhibition building boom, partnering with the country's Letian Entertainment.

Southern California exhibitor UltraStar Cinemas has formed a joint venture with China’s Letian Entertainment to build more than 40 cinemas in China.

The two companies plan to complete three cinemas by the end of 2013, and 40 more by the end of 2016. Letian is a subsidiary of China’s second-largest broadcast network, Hunan Broadcasting System. The new cinemas will be built in the Changsha area of Hunan province, where the company is based. The multiplexes will have 10 screens each, all with 3D and digital projection.

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“With the growing urbanization trend, the Chinese population continues to move from rural areas to densely populated cities,” John Ellison, president of UltraStar Cinemas, said in a statement. “This presents a long-term opportunity to grow the movie industry in China as a whole and implement cinema technologies and concepts that have been successful here in the United States.”

The deal is the latest in a flurry of partnerships and buyouts between Chinese and North American film exhibitors. In July, giant screen exhibitor Imax announced a deal with Wanda Cinema Line Corp. to build 120 new theaters in China -- the agreement made Wanda Imax’s largest international exhibition partner. In 2012, Wanda’s Cinema’s parent company, real estate conglomerate Dalian Wanda Group, bought out AMC Theatres, North America’s second largest cinema chain, in a flagship deal. And in May, California-based 3D cinema licensor RealD signed an agreement with Chinese theater chain Zhejiang Xingguang Cinema Circuit to equip 50 of its movie theaters across the country with RealD 3D technology.

China is in the midst of a historic boom in cinema building. By most estimates, the country currently has about 13,000 movie screens in total, and is adding 12 new screens each day. The United States has about 39,600 screens. At its current rate of construction, China will surpass the U.S. total within five years.