NEWS ANALYSIS
Money continues to flow out of China and into foreign assets unabated, despite Beijing’s tightening capital controls. But Beijing has no qualms about providing funding to one particular region—Hollywood.
Chinese companies are developing a keen interest in entertainment, as several Hollywood studios and production companies announced recent tie-ups with Chinese investors.
For China, the film industry’s lure is evident. China hopes to tap into Hollywood’s expertise as it builds up its own nascent entertainment industry. It also understands popular culture’s potential as a PR platform for the Chinese Communist Party on the global stage.
Tang Media Partners, an investment firm founded by businessman Donald Tang and backed by Chinese internet giant Tencent Holdings, last week acquired a controlling stake in IM Global, a film sales and distribution firm in Los Angeles.
In April, Chinese film producer Huayi Bros. Media Corp. formed a partnership with Burbank, Calif.-based STX Entertainment, to collaborate on a slate of new films.
The deal gives Huayi—one of the biggest in China—a foothold in Hollywood from which it can launch films with a bigger international audience.
Earlier this year, property developer Wanda Group purchased a controlling stake in Legendary Entertainment for $3.5 billion. The Burbank, Calif.-based Legendary is the production company behind many hit films including “Interstellar” and “Jurassic World.”
Tencent and Chinese online retailer Alibaba have been interested in film distribution for years. Alibaba Pictures Group invested directly in last year’s “Mission Impossible—Rogue Nation” and obtained distribution rights in China. The film generated more than $680 million in total global box office receipts.
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