Building firm eyes profit from movies
Source: Agencies |
November 16, 2011, Wednesday
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Print Edition
Print Edition
A Hollywood-China movie production venture that plans to make big budget films for worldwide audiences has been cleared for an infusion of US$220.5 million from an unlikely source - a construction company.
Shareholders of Hong Kong's Paul Y. Engineering Ltd yesterday approved the investment in the joint venture that is also aimed at China's increasingly lucrative film market.
The construction company, which says it wants to diversify and thinks the movie industry has strong growth potential, is taking a 50 percent stake in the production company, Legendary East Ltd, in exchange for the investment.
"Diversification into some unremarkable business is totally useless. Profit margin would be low, risk high," Paul Y. Chairman James Chiu said. "We decided to seek an innovative growth avenue."
After the deal, Hollywood production house Legendary Entertainment will have a 40 percent stake while China's Huayi Brothers Media Corp will hold the remaining 10 percent.
Legendary Entertainment has produced global blockbusters including "Inception" and the two "Hangover" movies while Huayi releases include the hit Feng Xiaogang disaster epic "Aftershock," the kung fu drama "Shaolin" and the Tsui Hark fantasy epic "Detective Dee and the Mystery of the Phantom Flame."
Paul Y executives promised to leave the movie making to the experts.
"What we're bringing to the table is, practically, cash," Deputy Chairman Tom Lau said. "We do not understand the business of motion pictures nor do we pretend that we can contribute" anything more than money.
Legendary and Huayi executives will control the film development and approval committees "completely," Lau said.
Shareholders of Hong Kong's Paul Y. Engineering Ltd yesterday approved the investment in the joint venture that is also aimed at China's increasingly lucrative film market.
The construction company, which says it wants to diversify and thinks the movie industry has strong growth potential, is taking a 50 percent stake in the production company, Legendary East Ltd, in exchange for the investment.
"Diversification into some unremarkable business is totally useless. Profit margin would be low, risk high," Paul Y. Chairman James Chiu said. "We decided to seek an innovative growth avenue."
After the deal, Hollywood production house Legendary Entertainment will have a 40 percent stake while China's Huayi Brothers Media Corp will hold the remaining 10 percent.
Legendary Entertainment has produced global blockbusters including "Inception" and the two "Hangover" movies while Huayi releases include the hit Feng Xiaogang disaster epic "Aftershock," the kung fu drama "Shaolin" and the Tsui Hark fantasy epic "Detective Dee and the Mystery of the Phantom Flame."
Paul Y executives promised to leave the movie making to the experts.
"What we're bringing to the table is, practically, cash," Deputy Chairman Tom Lau said. "We do not understand the business of motion pictures nor do we pretend that we can contribute" anything more than money.
Legendary and Huayi executives will control the film development and approval committees "completely," Lau said.
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