China

TODAY'S TOP STORIES: Chinese Films Look for U.S. Audiences; China Looks to Cool Interest in Independent Cinema on August 30, 2013

Hollywood films are finding wide audiences in China, but why aren't Chinese films finding similar success in North America? [China Daily].

Looking for a surge in independent filmmaking in China? You might have to wait a while. [U.S. News and World Report]

 

Bona Launches RMB 1 Billion Film Fund to Finance Future Theatrical and Non-Theatrical Productions on August 30, 2013

BEIJING -- Bona Film Group Limited ("Bona" or the "Company") (Nasdaq:BONA), a leading film distributor and vertically integrated film company in China, today announced that it has launched Wuhu Bona Jinyu Film Investment Center (the "Fund"), an RMB 1.0 billion (approximately US$163.4 million) fund that will finance the development and production of Bona's film and TV projects over the next two years.


The fund is established and managed by Wuhu Bona Film Investment Management Limited, a newly formed limited liability company whose shareholders include Bona, Sequoia Capital Investment Advisory (Tianjin) LLC ("Sequoia") and Gopher Asset Management Co., Ltd. ("Gopher"), a division of Noah Holdings Limited (NYSE:NOAH). Bona holds an equity stake in the Fund of approximately 30%, representing the commitment of investment rights in current and future projects, with approximately 70% of the Fund owned by outside investors.


"We are extremely proud to be a part of the Fund, which is the first of its kind in the history of Chinese film and a significant milestone not only for Bona, but for our industry. Investor reaction to this concept during the fundraising process has been extremely positive, and resulted in the Fund not only meeting its target investment level, but a sizable oversubscription. The enthusiasm we have seen from seasoned investment professionals speaks to the value of the Bona name in the industry, as well as the strength of our film pipeline and our position as one of China's leading non state-owned film companies. We believe that there is a significant unmet demand for vehicles such as the Fund, which will allow investors to participate more directly in the growth of China's burgeoning film industry, and we plan to explore opportunities to further develop additional financing entities following the launch of the Fund," said Bona's founder, Chairman and CEO, Mr. Yu Dong.

"Chinese cinema is in the midst of a period of tremendous growth, with total box office revenues in the first half of 2013 increasing 35% over the same period of last year. With rapid growth in theaters nationwide as a result of the ongoing urbanization movement and increasing availability of disposable income associated with the rise of China's middle class, we believe that China is poised to build upon its recently attained status as the world's second largest film market in the coming years. This new fund will help Bona further expand its competitive advantages in film investment and production as we continue to strengthen our capabilities in the areas of distribution and exhibition."

Mr. Yu added, "The launch of this Fund is expected to provide substantial benefits for Bona, as it will greatly enhance our production capacity, enabling us to bring not only more, but higher quality film and television projects to audiences in China and abroad. It will significantly reduce the challenges and risks associated with individual project financing, allowing us to more effectively plan the timing of future releases and shorten the pre-production process, while maintaining creative control over our films and TV series and giving us the opportunity to meaningfully increase our production market share. Moreover, the investment and production financing provided by the Fund will enable us to devote our internal capital resources to the Company's other growth engines such as the expansion of our theater network and ongoing enhancement of our film distribution capabilities. We believe that the Chinese film industry is at a critical point in its evolution, and the benefits of participating in the Fund will help bring us closer to our goal of becoming China's largest non state-owned film producer, distributor and exhibitor while leading the continued advancement of the industry and creating incremental shareholder value."

Projects financed by the Fund are expected to include theatrical releases and television series, and will include both Bona-produced films as well as films developed through co-production agreements such as those previously announced with Fox International Productions, Universal Pictures and Working Title Films. Where applicable, Bona will distribute all films in which the Fund invests, domestically and internationally. Proceeds from the Fund will be distributed to investors based on their initial investment in the Fund, as well as the Fund's internal rate of return.

The Fund expects to provide financing for such highly anticipated films as Tracks in the Snowy Forest, The Third Master's Sword and Moscow Mission, the first project under Bona's previously announced co-production agreement with Fox International Productions.

 

TODAY'S TOP STORIES: Luhramann Looks at China for an Upcoming Project on August 29, 2013

  • Arclight Films named Elliot Tong as the head of its Beijing office. Arclight is the latest sales company to open an office in China [Variety]
  • Bona, a leading Chinese distributor, launches a $1 Billion RMB fund to help finance domestic production [Wall Street Journal]

 

'Monsters University' Posts $13M Premiere on August 26, 2013

It was a good week for Hollywood releases in China, one that began with a thunderous performance from Jurassic Park 3D. The re-release of Steven Spielberg's modern classic was a hit in its first six days in China, amassing a total of $28.8 million from 2,500 locations.

The big premiere of the weekend came with the debut of Monsters University. The film opened to $13 million in China, making the Pixar prequel the biggest animated opening for Disney in the market. Monsters University posted the fourth biggest debut for a Disney release and the third biggest animated Disney film in China.

Pacific Rim overtook Mission: Impossible 4 - Ghost Protocol as the fifth highest grossing MPA release in China. The Guillermo del Toro film has grossed a total of $106.6 million in the market.

Fast 6 finished the week with a $65.9 million cume after 31 days in release in China.

 

CHINA: Study Finds Overwhelming Moviegoer Support For Building New Ratings System on August 23, 2013

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According to a recent survey of 6,000+ Chinese moviegoers conducted by EntGroup, a Beijing-based data company, more than 90% of moviegoers "support" or "accept" establishing a rating system. Only 2.6% believe a rating system should not be implemented and that it would not benefit the film industry.

"Some films released recently, including Journey to the West [pictured above], caused people to complain that they were too scary for kids. Therefore, we believe an appropriate rating system will not only provide better guidance for parents with young children, but also offer more choices for majority of the moviegoing audiences in China," Nancy Wu, director of North American Operations for EntGroup tells BoxOffice. 

The censorship that results from the lack of a ratings system is a major factor that fuels piracy in China. Hollywood releases such as Cloud Atlas and Django Unchained have been heavily trimmed in order to snag a release in China, forcing fans who want to see a filmmaker's true vision to seek it out in other ways. Django suffered quite a bit as a result of censorship. After its release was delayed at the last minute, Quentin Tarantino's unconventional Western opened with a whimper and managed only around $3 million during its run in China.

A ratings system that allows adults to seek out adult entertainment and families to seek out family entertainment would boost a film market that is already growing at a staggering rate.


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