Tencent, Huayi, Yunfeng create new studio
Chinese internet titan Tencent, film studio Huayi Brothers and Alibaba founder Jack Ma’s Yunfeng Capital are setting up a Hong Kong-listed company to develop films for China and overseas.
The three companies have made a $71m offer to buy a controlling stake in Hong Kong-listed shell company China Jiuhao Health Industry. If the deal goes through, they plan to create a new production entity to develop a slate of 10 live-action and three animated features in partnership with US studios.
Huayi Brothers will own a 18% share in the new company, Tencent will hold 16% and Yunfeng will have a 5% share. Buying out Hong Kong-listed shell companies is a common tactic for gaining a stock market listing in China.
The deal marks another alliance between rivals Ma and Tencent founder Pony Ma who have teamed up on several ventures in the past year, including a merger of group buying sites Meituan.com (backed by Alibaba) and Dianping.com (backed by Tencent). Both are also expanding their film production and online streaming businesses.
One of China’s biggest movie producers, Huayi Brothers recently signed a financing deal with Robert Simonds’ STX Entertainment.